Fiscal constraints to delay IOCL's petrochem complex

The petrochemical complex of Indian Oil Corporation Ltd (IOCL) proposed to be set up at the site of its 15 million tonne per annum refinery at Paradip is set to be delayed due to financial constraints.

Work on the petrochemical complex is expected to begin two years after the commissioning of the refinery.

“Financial constraints would delay the establishment of the petrochemical project in Paradip. IOCL is reviewing the situation to expedite work. The petrochemical project would be started after two years of operations of the Paradip refinery project”, Brij Mohan Bansal, IOCL chairman told media persons at Paradeep.

He said, IOCL’s Rs 29,777-crore Paradip refinery will be commissioned in two phases. Phase-I production is expected to start by March 2012 while second phase production is scheduled for November 2012. The production from the refinery will cater to the domestic market rather than exports as planned earlier, he added.

The refinery project involves massive civil, structural and mechanical works involving 2600 equipment, 1400 km of piping, 90,000 bored and driven piles, 500,000 cubic metres of concreting and 1600 km of electrical cables in which 10,000 people have been engaged to expedite this work.

All major contracts amounting to Rs 25,010 crore have already been awarded and an expenditure of Rs 5030 crore has been made on the project. Major equipment has started arriving at site. Shipping consignment weighing more than 135 tonnes (single equipment imported from Korea) has been received at the Paradip Port recently.

It may be noted that the decks have been cleared the Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR) project in Paradip, which is expected to attract investments to the tune of Rs 2.74 lakh crore with the Cabinet Committee on Economic Affairs (CCEA) giving the green signal.

The refinery will produce 5.97 million tonnes of diesel, 3.4 million tonnes of petrol, 1.45 million tonnes of kerosene/ATF (Aviation Turbine Fuel), 536,000 tonness of LPG, 124,000 tonnes of naphtha and 335,000 tonnes of sulphur, all of which will be for sale in the domestic market.

Asked on employment opportunities for the land losers, Bansal said, “Qualified and skilled persons would get employment opportunities in the refinery project on priority basis.”

On measures to check frequent oil leakage from IOCL pipe line, Bansal stated that he has inspected the spot and steps have been taken to rectify the leakage.

Bansal laid the foundation stone of Atmospheric and Vacuum Distillation Unit being set up at a cost of Rs 84 crore to control 16 satellite track rooms under refinery project at Paradip.