Public sector oil firms IOC, BPCL, HPCL and EIL will invest Rs 1500 billion in setting India's biggest refinery on the west coast, Oil Minister Dharmendra Pradhan said.
Indian Oil Corp, the nation's biggest refiner, will build a 60-million ton a year oil refinery in Maharashtra along with Bharat Petroleum Corp Ltd (BPCL), Hindustan Petroleum Corp Ltd (HPCL) and Engineers India Ltd (EIL), Pradhan said in a twitter post. "Refinery to be built in 2 phases (40+20 million tons); 1st phase will have more than Rs 1000 billion investment (biggest in India)," he said.
IOC has been looking at west coast for a refinery as catering to customers in West and South was difficult with its refineries mostly in the North. HPCL and BPCL have also been looking at a bigger refinery because of constraints they face at their Mumbai units. "The refinery will produce petrol, diesel, LPG, ATF and feedstock for petrochemical plants in plastic, chemical and textile industries in Maharashtra," said Pradhan, who discussed the setting up of the refinery with Maharashtra Chief Minister Devendra Fadnavis in Mumbai yesterday.
"Govt of Maharashtra and Ministry of Petroleum and Natural Gas will closely work for early identification of land for refinery and finalisation of details of project," he added. Fifteen million tons a year is the biggest refinery any public sector unit has set up in one stage. IOC recently started its 15 million tons unit at Paradip in Odisha. Reliance Industries holds the distinction of building the biggest refinery in India till now. It built its first refinery at Jamnagar in Gujarat with a capacity of 27 million tons, which was subsequently expanded to 33 million tons.
It has built another unit adjacent to it for exports, with a capacity of 29 million tons. The refinery being planned by the state-owned firms will be bigger than that. The phase-1 itself will be bigger than any one single unit. It will cost Rs 25 billion per million tons and for the full 60 million tons it will cost Rs 1500 billion. It will also be accompanied by a petrochemical complex. Being on the west coast will provide the unit a natural advantage of easily sourcing crude oil from the Middle-East and Africa, officials said.
Also, moving products to consumption heartland will not be difficult. IOC has six refineries with a total capacity of 54.20 million tons. It also has subsidiary refineries with 11.50 million tons capacity. Paradip has taken its refining capacity to 80.7 million tons.