The Cabinet Committee on Economic Affairs (CCEA) yesterday cleared Cochin Refin- eries Ltd's proposal for a 500 mw power project in

Cochin Refineries has been given permission to form a joint venture with CAEC, Larsen and Tubro (L&T) and the Kerala State Electricity Board (KSEB).

The project, which will be located at Ambalamugal, near Kochi, is expected to entail an investment of Rs 2,100 crore.

The Cochin Refineries project will use residual fuel oil (RFO) as fuel for power generation.

The project will help ease the power crisis in the state and enable Cochin Refineries to improve its profitability.

Cochin Refineries, with a capacity of about nine million tonnes a year, is one of the two major oil refiners in south India. The other is Madras Refineries.

According to studies conducted by the state government, residual fuel oil has no other use. The studies recommended the use of residual fuel oil in Cochin itself as its transportation to other locations would be uneconomical.

The project is expected to come on stream in four years. The joint venture with the state electricity board is expected to expedite the completion of the project.

Cochin Refineries is also planning to set up a 500mw power project in Punjab along with Punjab Refinery and Hindustan Petroleum Corporation Ltd.