IOC to borrow Rs 10,000 cr for Paradip refinery

State-run oil refiner Indian Oil Corp has tied up over Rs 10,000 crore debt for its 15-million-tonne Paradip refinery, which is scheduled for commissioning in the first quarter of 2012.

IOC had mandated SBI Caps for arranging Rs 14,700 crore debt for the project.

"Till now, we have received commitments for over Rs 10,000 crore from a clutch of public sector banks," a company official said.

State Bank of India has committed to lend Rs 4,200 crore, the maximum by any bank in the loan syndication.

Other banks which would lend to the firm includes Bank of Baroda, Bank of India, Canara Bank and State Bank of Hyderabad.

"We are targeting to close the financing by next month, the official said. Even if we don't get commitments for the remaining amount, we will close the syndication and proceed with the project. The remaining amount may be tied-up as the project progresses," he said.

IOC is financing the Rs 29,777 crore project in 1.5:1 debt-equity ratio, he said, adding the refinery is being targeted for commissioning in the first quarter of 2012.

The board of IOC had last year split the refinery cum petrochemical complex into two, deciding to do the refinery first and the chemical unit will follow later.

Paradip refinery, he said, is being configured to process the toughest, heaviest and the most dirtiest crudes.

The refinery will have a Nelson Complexity Index of 15.

Reliance Petroleum recently commissioned the only-for-exports refinery at Jamnagar, which has a Nelson complexity of 14.

The higher the index, the more technically capable a unit is to process tough high sulphur, waxy crudes.