We are going ahead with LNG project: IOC chairman

A Banker says IOC not able to find strategic partner, who can bring value to project

Indian Oil Corporation today said that it will go-ahead with its Rs 4,320 crore first liquefied natural gas (LNG) plant at Ennore, near Chennai in spite it select partner or not.

Speaking to reporters after addressing Chennai Petroleum Corporation Ltd (CPCL's), a subsidiary of IOC, shareholders at Chennai today R S Butola, chairman, IOC said, "We are going ahead with the project, in spite we select our partner now or later. Some bids will be out and we will appoint the contractors for the tanks and jetty".

According to a Banker, IOC is not able to find a strategic partner, who can bring value to the project. "They are looking for a partner who can source gas globally for the new project and who got experience in operating LNG terminal," said the Banker.

The company is setting up a five million tonne a year LNG terminal at Katupalli in Ennore. The project will attract investment to the tune of Rs 4,320 crore. The terminal can be expanded to 10 to 15 million tonne per year. This is part of company's Rs 56,000 crore investment plan during the 12th Plan Period.

Meanwhile, the IOC Chairman said the first unit of Paradip Refinery will start by end of this year and the company will examine setting up a refinery on the West Coast.

On under-recoveries, Butola said,last year under recovery was around Rs 1 lakh crore and this year it may be in the range of Rs 1.38-1.45 lakh crore. of which IOC's would be Rs 70,000 crore as compared to around Rs 40,000-45,000 crore last year.

Speaking about CPCL's investment, the Corporation's Managing Director A S Basu said that the company has lined up Rs Rs 4,000 crore investment towards expansion of existing refining capacity, for upgradation of refinery residues to distillates and others.

Major chunk of the investment will be towards Resid Upgradation Project, which will attract investment to the tune of Rs 3,110.36 crore.

Butola said the project is scheduled to be completed by the end of December 2015.