Petronet LNG Ltd on Tuesday said the offer price of its initial public offering of 261 million (26.1 crore) shares, which will be floated around mid-February, will be decided through book building.

"We plan to offer 26.10 crore shares of Rs 10 each, representing 34.8 per cent of the total equity of the company, at a premium that will be decided through the book building," PLL director (finance) P Dasgupta said in New Delhi.

Book building is a process undertaken by which a demand for the securities proposed to be issued is elicited and built up and the price of such securities is accessed for the determination of the quantum of such securities.

PLL, which has completed construction on India's first liquefied natural gas import and regassification terminal at Dahej in Gujarat, has appointed DSP Merril Lynch, SBI Cap, J M Morgan Stanley, ICICI Securities and Enam as merchant bankers of the issue that will hit market around February 15, he said.

The company will file the prospectus of the public issue this week, he said, adding PLL share would be listed on the Bombay Stock Exchange and National Stock Exchange.

PLL, which is promoted by state-owned refiners Indian Oil Corporation and Bharat Petroleum Corporation Ltd, gas transmission utility Gail India Ltd, and upstream giant Oil and Natural Gas Corporation, plans to begin commercial gas sales from April 1.

The four state-run promoter firms hold 12.5 per cent stake each in PLL, while project consultant Gaz de France has another 10 per cent.

The IPO will help PLL achieve financial closure for the 5 million tonnes a year capacity Dahej project.