5 hours Ago By Sidhartha
NEW DELHI: Virtually ruling out a mega oil refinery in Maharashtra's Ratnagiri, the govt is holding talks with Saudi authorities for two refineries in Gujarat and Andhra Pradesh, each with an annual capacity of 10-15 million tonnes, along with petrochemical facilities. While ONGC has been proposed to partner Saudi Aramco for the refinery in Gujarat, BPCL will be roped in for the one planned in Andhra. For the Saudis, the refineries will enable the sale of crude to India, given that the share of oil from the Gulf nation in the Indian basket has decreased over the years.
The discussions, which are in advanced stages, come ahead of PM Modi's meeting with the Saudi leadership next month to tap into the oil-rich nation's earlier promise to invest $100 billion in India, which has been slow to come by despite the govt identifying railways, ports and waterways as areas of interest. Refinery idea 1st floated during AP bifurcation While the refinery in Ratnagiri was among the identified projects, progress on land acquisition has been slow due to resistance from locals. Besides, there was a growing view that it would be tough to have a 60-million-tonne refinery, for which Indian Oil, Hindustan Petroleum Corporation Ltd (HPCL) and Bharat Petroleum Corporation Ltd (BPCL) had signed a preliminary agreement with Saudi Aramco, with Adnoc joining in later.
Gujarat, which already boasts of refineries in Jamnagar (Reliance and Nyara Energy) and Vadodara (Indian Oil), is likely to get a fourth one. In case of Andhra Pradesh, an oil refinery was proposed at the time of bifurcation of the state, and the govt led by N Chandrababu Naidu, who is now part of NDA, is seeking that Centre delivers on its promise. While the configuration and other details have not been worked out, sources indicated that the projects are at discussion stage, along with other proposals, some of which will be faster to implement.
"Oil refineries take time, and the two proposed projects will require more detailed work before we progress on them," a source told TOI. The Saudi side is also seeking comfort in investment promotion through a revised bilateral investment treaty, an issue on which finance ministry has had concerns. "It could be an added sweetener, but since the deal will be at the level of two govts, there may be some other way out," another source said.
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