Govt committed to completing Bhatinda, Bina refineries

Wednesday, 19 February 2003, 08:00 Hrs
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NEW DELHI: India is committed to completing the Bhatinda and Bina refineries despite plans to privatise the oil companies that are erecting the plants, Parliament was informed Tuesday.

The Bhatinda refinery in Punjab is of nine million metric tonnes per annum (MMTPA) capacity while the Bina refinery in Madhya Pradesh is of six MMTPA.

The projects would either be implemented through Hindustan Petroleum Corporation Ltd (HPCL) and Bharat Petroleum Corporation Ltd (BPCL), earmarked for disinvestments, or through other government agencies, Petroleum Minister Ram Naik and Minister of State for Petroleum Santosh Gangwar told Parliament in written replies Tuesday.

The Bhatinda project, which includes a 140 MW captive power plant, a port at Mundra in Gujarat for importing crude oil and a crude oil pipeline for transporting crude from the import terminal to the jetty, has been become uncertain with the government deciding to divest 34.01 percent equity in HPCL to a strategic buyer.

The fact that the Bhatinda refinery is close to state-owned Indian Oil Corporation's Panipat refinery, which is being expanded to raise its capacity from six million tonnes to 12 MMTPA has also raised doubts about its viability.

Given that the 18 refineries in the country, with a capacity of 115 MMTPA, are having to look overseas for markets due to the lower than expected demand, has also put a question mark on the two new projects.

"The refinery project at Bhatinda is being implemented by Guru Gobind Singh Refineries Ltd., a subsidiary of HPCL. As of January 31, cumulative expenditure on the project is 2.78 billion, and the physical progress including acquisition of land and construction work is around five percent complete," Naik said in a written reply in the upper house of Parliament.

"The refinery project at Bhatinda will either be implemented by HPCL or the government thorough an appropriate agency," Naik clarified.

So far 1,992 acres of land for the Bhatinda project has been acquired and the boundary wall constructed.

"Various civil jobs at the refinery complex have been completed. Steel plates for refinery storage tanks have been received. Detailed route survey of 1,011 km along with crude oil pipeline from Mundra Port to Bhatinda has been completed, and 310 acres of land for crude oil terminal at Mundra has been acquired. Work at refinery site is also in progress," the house was informed.

According to government projection, the consumption of petroleum products during 2003-04 is estimated to be around 107 MMT, which will rise to 111 MMT by 2004-05.

"The domestic production and quantum of imports of petroleum products would depend upon several factors including domestic demand, duty structure, refining margin and export potential. The domestic production of petroleum products during 2003-04 is estimated to be around 114 MMT," Gangwar said in a written reply.

On the progress at Bina Refinery, Gangwar said the "entire land for the refinery and township blocks at Bina and crude oil terminal at Vadinar (Gujarat) has been acquired."

Acquisition of right or user and right of way along with the entire 935 km length of cross-country crude oil pipeline has been almost completed. Design engineering packages of the licensed units have been received from the selected process licensors for proprietary process units.

Front end engineering design for the project has been completed by state-owned Engineers India Limited, who are project management consultants.

Till January, 1.50 billion had been spent on the Bina project with 5.3 percent of the physical progress completed.

Like in the case of Bhatinda refinery, Gangwar assured that Bina refinery would also be completed either by BPCL, or by the government through an appropriate agency.

Source: IANS
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