BHEL to reboot offshore equipment business
10 October 2009
State-run Bharat Heavy Electricals Ltd has decided to try and revive its offshore oil rig equipment business, which it was earlier planning to exit. It will approach shipyards for orders to provide equipment used in making oil rigs, BHEL chairman and managing director B P Rao said on Friday.
"We would approach some shipyards for providing equipment for manufacturing offshore oil rigs... cannot name them (shipyards) as of now," he told newspersons in New Delhi. The company had earlier decided to quit its deep water oil rig business as it was unable to find a suitable partner due to investment constraints.
"Currently we are in onshore oil rigs business with ONGC and Oil India ... we are engaged in refurbishment of these rigs," Rao said. He added that BHEL has manufactured and supplied over 80 drilling and well servicing rigs to both the Oil and Natural Gas Commission and Oil India Ltd.
The company's primary business is manufacturing power equipment, and it plans to augment its manufacturing capacity to support 15,000 mw of electricity generation by the end of this financial year, and further enhance it to 20,000 mw by 2012, Rao said. The company currently has a total capacity of 10,000 mw a year.
BHEL is also planning overseas buys to gain new markets and technologies, and will diversify into areas such as transmission, transportation and nuclear power. Rao, who took over as head of India's largest power-equipment maker last week, said Europe and the former Soviet republics were focus areas for the firm.
"Acquisitions are generally in order to acquire intellectual property rights or to acquire a market," Rao said. "We're looking at opportunities for satisfying either of those needs."
Rao did not deny media reports about BHEL beginning due diligence for buying into a Hungarian power plant parts maker, but offered no comment.