Green blockade sends HPCL refinery plan into cold storage

Decision on the Rs 30,000-cr project after clarity on report on Western Ghats, region termed ecologically sensitive by Madhav Gadgil-led ecology expert panel

Three years after it decided to set up a second refinery in Maharashtra at a cost of Rs 30,000 crore, Hindustan Petroleum Corporation Ltd (HPCL) has put the plan into cold storage. Chairman and Managing Director Subir Roy Choudhury said the company was going ahead with its Rajasthan refinery project, adding it would decide on the Maharashtra refinery only after it received clarity on a report on the Western Ghats.

“We want to invest in new projects and grow. The Rajasthan government has given us good incentives and we are going ahead with the refinery,” Roy Choudhury said at a press conference in Mumbai. He added the moratorium (applicable in the case of the Maharashtra project) was up to 2014 and the company wasn’t sure how things would pan out after that. “Therefore, we have decided to go ahead with our other projects.”

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• HPCL also has a refinery in Visakhapatnam, Andhra Pradesh, with a capacity of 8.3 mtpa
• It has a refinery in Punjab’s Bathinda (pictured), with a capacity of nine mtpa. This  was set up at a cost of Rs 21,500 crore through a joint venture with steel magnate L N Mittal. The refinery’s capacity is slated to be increased to 18 mtpa
• In July this year, the Rajasthan government and HPCL signed an agreement to set up a joint venture company, HPCL Rajasthan Refinery Ltd, to execute a nine mtpa oil refinery in Barmer district. HPCL would hold 74 per cent stake in the refinery. The refinery-cum-petrochemical complex is scheduled to come up in four years at Pachpadra, at an estimated cost of Rs 37,229 crore

The Madhav Gadgil-led Western Ghats ecology expert panel had termed the entire hill range an ecologically sensitive area and suggested “no new dams based on large-scale storage be permitted in ecologically sensitive zone-1 and no new polluting industries, including coal-based power plants, be allowed in the zones”. It had classified 142 taluks in the Western Ghats into three ecologically sensitive zones.

The panel had recommended, “The current moratorium on new environmental clearances for mining, and red and orange category polluting industries and power plants in the plains and coastal tracts of Ratnagiri and Sindhudurg districts should be extended till satisfactory completion of a carrying-capacity analysis. The moratorium may then be reviewed in light of the findings of the study.”

Facing constraints on expansion at its Mumbai refinery, HPCL had, in 2010, decided to set up a nine million-tonne-per-annum (mtpa) refinery in Tavsal, Guhagar, in Maharashtra’s Ratnagiri district. For this, the company needs 3,000 acres.

Earlier, it had decided to set up the refinery at Lote Parshuram in Chiplun, Ratnagiri district.

In 2011, Roy Choudhury had said the refinery would be ready in four years, once it secured an environmental clearance. Engineers India Ltd has already prepared a detailed feasibility report for the new refinery.

HPCL also has one refinery each in Visakhapatnam (Andhra Pradesh) and Bathinda (Punjab), with capacities of 8.3 mtpa and nine mtpa, respectively. The Bathinda refinery was set up at a cost of Rs 21,500 crore through a joint venture with steel magnate L N Mittal. The refinery’s capacity is slated to be increased to 18 mtpa.

In July this year, the Rajasthan government and HPCL had signed an agreement to set up a joint venture company, HPCL Rajasthan Refinery Ltd, to execute a nine mtpa oil refinery in Barmer district. HPCL would hold 74 per cent stake in the refinery. The refinery-cum-petrochemical complex is scheduled to come up in four years at Pachpadra, at an estimated cost of Rs 37,229 crore.

The refinery would source crude oil from Cairn India’s Rajasthan oil fields, as well as imported crude oil, Roy Choudhury said.