 HPCL plans to invest about Rs 15,000 crore in setting up a 9 million tonnes-a-year refinery on the west coast. The new refinery, which may be in Raigad district of Maharashtra, is being mulled to make up for space constraint that its Mumbai refinery faces at present.
"We have been shown three pieces of land by Maharashtra government. We
should be able to finalise the location in next few weeks," a company
official said. HPCL wants to build a 9 million tonnes unit and then double it at a later date.
"We should be able to finalise location and size of the refinery in 3-4
months," he said. "A consultant for doing detailed feasibility report
(DFR) will be appointed soon."
The land offered for the refinery is located between Ratnagiri and
Raigad districts. The unit, called Maharashtra Refinery, would be
completed in 48 months from the date of receiving all approvals, he
said.
"We face tremendous space constraint at our 6.5 million tonnes-a-year
Mumbai refinery. A refinery of this size is spread over 2,000 acres of
land but our refinery is spaced in just 350 acres. We feel in 5-10
years, the space constraint will make the unit inefficient," the
official said.
He said the Mumbai refinery may eventually be shutdown once the new
refinery is built. "That decision we need to take in 6-7 years."
HPCL has a 7.5 million tonnes-a-year unit at Vizag in Andhra Pradesh and
is also building a 9 million tonnes plant at Bhatinda in Punjab in joint
venture with steel czar Lakshmi Mittal.
"We are commissioning a feasibility study which we expect will be
completed in six months. Investment decision will be made based on the
feasibility study," he said.
"We have sounded Maharashtra government for 2,500-3,000 acres of land for the project," he said.
The project may be funded in a debt-equity ratio of 2:1 or 2.5:1.
The new refinery project comes on the heels of HPCL being forced to put
on back-burner a USD 10 billion refinery-cum-petrochemical project at
Vizag after Mittal and French oil major Total SA pulled out.
The only-for-exports 14 million tonnes-a-year refinery was being planned to target South East Asia and the Middle East. Besides HPCL, Mittal and Total, the project also had Oil India Ltd and gas utility GAIL India as partner.
About 2,500 acres of land near HPCL's existing refinery at Vizag had
been acquired for the project, which was deferred after the pull-outs.
PETROLWORLD 08/09/2010 Source: ET
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