The company will invest Rs 14,225 crore in its Integrated Refinery Expansion Project at Kochi Refinery and Rs 5000 cr for setting up a petrochemical joint venture
The Kerala government has agreed to extend incentives like deferment of various taxes to Bharat Petroleum Corporation Limited (BPCL) for its Integrated Refinery Expansion Project (IREP) at Kochi Refinery and a petrochemical joint venture. A memorandum of understanding with the company was signed in this regard on Friday.
The total investment in both the projects is about Rs 20,000 crore, the company’s single largest investment in the state.
The proposed IREP project envisages increasing the capacity of Kochi refinery from the present 9.5 mmtpa to 15.5 mmtpa, modernisation of the refinery to produce auto-fuels complying with Euro-IV/Euro-V specifications, upgradation of low value refinery residue stream to value-added products and production of propylene, which is a major petrochemical feedstock.
The estimated cost of the IREP project is Rs 14,225 crore. The project is scheduled to be completed by December 2015.
V Somasunderan, additional chief secretary (Industries & Commerce) and RK Singh, chairman and Managing Director, BPCL, signed the MoU in the presence of chief minister Oommen Chandy.
Kochi refinery is in operation since 1966. The government has agreed to provide fiscal incentives like deferment of Kerala government sales tax (KGST)/VAT and CST and exemption of works contract tax for this project.
The company has also proposed to set up a propylene-based petrochemical complex in joint venture where the JV partner’s technology and marketing expertise will be used. BPCL has already signed an MoU with petrochemical major LG Chem, South Korea.
The estimated investment in the petrochemical JV will be in the range of Rs 5,000 crore to Rs 6,000 crore and the complex is expected to go on stream in tandem with the above expansion project.
