Oil & Natural Gas Corporation may be
compelled to re-consider the decision to shelve its plans to build a refinery
project at Kakinada in Andhra Pradesh.
The company had decided to defer its
plans to invest in Kakinada Special Economic Zone and to develop an
export-oriented refinery in Kakinada as preliminary reports about the
feasibility of the project were not optimistic. As per the preliminary study,
the refinery size should be at least 15 million tpa to make it viable, whereas
the original proposal was for a 7.5 million tpa refinery with an investment of
over Rs.7,500 crore.
ONGC, along with its subsidiary
Mangalore Refinery and Petrochemicals (MRPL), had inked two separate MoUs with
the state government and infrastructure lender during September 2006. The first
MoU was signed between the Andhra Pradesh Government, Infrastructure Leasing &
Financial Services (IL&FS) and Kakinada Seaports (KSPL) to promote the Kakinada
SEZ through a special purpose vehicle called 'Kakinada Special Economic Zone
Ltd'.
The export-oriented refinery will be
set up through a joint venture of ONGC-MRPL, the Andhra Pradesh Government and
IL&FS.
Also See:
ONGC withdraws
from Kakinada projects? (05-Oct-06)