Bathinda oil refinery to attract Rs 1,300 cr in Punjab

HPCL-Mittal Energy Limited (HMEL) today said the ambitious 9-million tonnes Bathinda oil refinery would attract an investment of Rs 1,300 crore in Polypropylene based downstream industry in the state.

"We think that after the completion of refinery, there will be an investment of Rs 1,300 crore in downstream industry in the state," HMEL Chief Executive Officer Prabh Das told reporters here.

Bathinda refinery will be one of the few refineries in the country, which will have the capacity to produce 4.40 lakh tonnes of polypropylene, an official said while adding that currently polypropylene granules are produced in Gujarat and Maharashtra.

 

With Ludhiana, Bathinda, Banur and Lalru being seen as most attractive locations for setting up polypropylene-based industry, about 50 per cent of the total produce would be consumed by the state itself, he said.

He added that polypropylene granules are mainly used by plastic industry such as woven sack and film units as main raw material in manufacturing of plastic items like buckets, mugs, toys, plastic furniture, wrapping films, woven sack bags for cement and food grains.

Das said the Rs 18,919-crore oil refinery is expected to be commissioned by June next year. "An investment of Rs 13,700 crore has already been made in the oil refinery," he said.

After commissioning, the refinery would produce high value petroleum products such as LPG, naphtha, petrol, diesel, aviation fuel and pet coke. The liquid products would be marketed through HPCL, the solid products like sulphur, pet-coke and polypropylene would be sold directly by HMEL.

As per the break up, the capacity of major products like diesel will be 3.7 million tonne, followed by petrol 1 million tonne, LPG 0.7 milion tonne and coke 0.9 million tonne in the upcoming refinery.

HMEL is a joint venture between Hindustan Petroleum Corporation Limited (HPCL) and Mittal Energy Investment Pvt Ltd, Singapore - a Lakshmi N Mittal Group Company. Both the JV partners hold a stake of 49 per cent each in the company, the rest 2 per cent is held by financial institutions.

Two MoU were also signed today by the HMEL refinery with Punjab Spintex, Northern Polyfilms for supply of polypropylene which will entail investment of Rs 40 crore. "The using capacity of both these companies will be 6,000 tonne of polypropylene," Das said.

On being asked about the fiscal sops, Das said the company has always been seeking incentives from the state government. "The response of the state government has always been supportive (with regard to demand of fiscal sops)," he said.

HMEL has been seeking Rs 400 crore per annum as interest free loan for the first 15 years from 2011-12 to 2025-26 which is to be paid back per annum from 16th year-2026-27 onwards for the next 15 years.

Speaking on this occasion, Punjab Deputy Chief Minister Sukhbir Badal that the state would receive an investment of Rs. 82,000 crore from four upcoming power projects and Bathinda refinery. "Today we wanted to showcase our Bathinda refinery project which will bring economic development in the state," he said.

Taking a dig at previous congress led state government, he said that last government did not bring a single big project in the state during its tenure. "But we want to tell that what we say we do," he said.