Oil giant Saudi Aramco is keen on holding exclusive talks to buy a stake in the world's biggest refinery-cum-petrochemical complex that India plans to build in Maharashtra at a cost of USD 40 billion.
Oil Minister Dharmendra Pradhan said Khalid A Al-Falih, Minister of Energy, Industry and Mineral Resources of Saudi Arabia and chairman of Saudi Aramco, during his meeting in Vienna last month expressed interest in taking a stake in the 60 million tonne(mt)refinery and 10-12 mt petrochemical complex.
"He was very categorical that Saudi Aramco is very keen to partner in the mega refinery from the very start," he said after state-owned oil firms IOC, BPCL and HPCL signed a joint venture agreement to set up the mega complex.
Saudi Aramco had previously been interested in new greenfield refineries set up in India but none of the interests materialised in investments.
The world's biggest oil producer was interested in the 9 mt Bhatinda refinery but exited the project in 1998. Thereafter, the refinery was set up by HPCL in joint venture with steel baron Lakshmi N Mittal.
Saudi Aramco had also initially shown interest in IOC's 15 mt Paradip refinery in Odisha but walked out of the project in 2006. The Indian Oil Corp (IOC) set up the refinery on its own thereafter.
Pradhan was, however, confident that Saudi Aramco was serious this time around. "They are saying that please talk to us exclusively (for the stake). They say you don't have to talk to anyone else," he said.
Besides Saudi Aramco, Abu Dhabi National Oil Co (Adnoc) has also shown interest in taking a stake in the project.
The country's top refiner IOC will initially hold a 50 per cent stake in the project, while Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corp (HPCL) will own 25 per cent each.
If a new partner like Saudi Aramco comes in, their stake will be cut proportionately.
The refinery-cum-petrochemical complex is expected to be commissioned by 2022.
"The proposed west coast refinery-cum-petrochemical complex will be the largest in the world, equipped with the best refining technologies," IOC Chairman Sanjiv Singh said.
Designed to produce Euro-VI and above grade transportation fuels, the refinery will have in-built flexibility for processing a wide spectrum of light and heavy crude oil grades, utilising various blending techniques.
It will also be able to produce on-demand product mix of petrol and diesel streams, as well as other refined products and petrochemical streams with the highest level of integration and energy efficiency.
IOC has been looking at the west coast for a refinery as the company found it tough to cater to requirements in West and South with its refineries mostly in the North.
The biggest refinery any public sector unit has set up at one stage has a capacity of 15 mt a year. The IOC recently started its 15 mt 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 mt, which was subsequently expanded to 33 mt.
It built another unit adjacent to it for exports, with a capacity of 29 mt.
India has a refining capacity of 232.066 mt, which exceeded the demand of 194.2 mt in 2016-17 fiscal.
According to the International Energy Agency (EA), this demand is expected to reach 458 mt by 2040.
IOC has 11 refineries with a total capacity of 81.2 mt while BPCL has four refineries with a total capacity of 33.4 mt. HPCL has three refineries with a total capacity of 24.8 mt.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)