Steel magnate LN Mittal, France’s Total, Hindustan Petroleum Corporation (HPCL), Oil India and GAIL have announced they will decide by December this year, on the feasibility of spending $6bn to set up a 14 million tonne per annum (tpa) refinery and petrochemical plant at Visakhapatnam in Andhra Pradesh, India.
The five companies had signed an agreement in October last year to set-up a 15 million tonne refinery and 1 million tonne petrochemical complex, with the capacity of the refinery now reduced to 14 million tonnes ‘to make it more feasible’.
“The pre-feasibility study is on. Before the end of the year we will know if we will move ahead with the project,” Total Asia-Pacific Senior Vice-President Thierry Pflimlim is believed to have said recently.
The project is expected to be completed 4-5 years from the start of construction.
HPCL already operates a 7.5 million tonne refinery in Visakhapatnam, with the company also planning to expand the refinery to 15 million tonnes. The company is setting up a 9 million tonne refinery at Bathinda in Punjab too, along with LN Mittal’s Mittal Investments, which owns 49% in the refinery.
The proposed refinery and petrochemical plant is expected to export most of the oil products it produces, with an analyst thought to have indicated that the market is strong for petroleum products in South East Asia and a refinery on India’s east coast is therefore ‘feasible’.