HPCL refinery may be boost for Andhra Pradesh fortunes

Discussion in 'Economy & Infrastructure' started by Srinivas_K, Jun 13, 2014.

  1. Srinivas_K

    Srinivas_K Senior Member Senior Member

    Jun 17, 2009
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    HPCL refinery may be boost for Andhra Pradesh fortunes

    HPCL says it has begun a feasibility study on a proposed 15 mtpa crude oil refinery in the state


    Hyderabad: Hindustan Petroleum Corp. Ltd (HPCL) said on Thursday that it had begun a feasibility study on a proposed 15 million tonne per annum (mtpa) crude oil refinery in residuary Andhra Pradesh—a project that would deliver a major boost to the economy of the southern state after the separation of Telangana.
    The planned refinery and cracker unit, which would cost an estimated Rs.60,000-70,000 crore to build, would serve as the anchor unit of the Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR), a 603 sq. km enclave that is coming up between Visakhapatnam and Kakinada in the coastal Andhra region.
    “We have been mandated by government of India to look at this project, so we have started working on it,” said H. Kumar, executive director, corporate strategy and planning, HPCL.
    HPCL is carrying out market analysis, configuration and feasibility studies that Kumar expects would take six months to complete.
    “There is a proposal for a greenfield refinery by HPCL or its consortium, for which a detailed financial report is getting prepared,” said Indrajit Pal, secretary, department of chemicals and petrochemicals, government of India.
    The project is a promise made by the Union government to residuary Andhra Pradesh—comprising the regions of coastal Andhra and Rayalaseema—after New Delhi’s decision to grant statehood to Telangana, which became India’s 29th state on 2 June.
    “IOC (Indian Oil Corp. Ltd) or HPCL shall, within six months from the appointed day, examine the feasibility of establishing a greenfield crude oil refinery and petrochemical complex in the successor state of Andhra Pradesh and take an expeditious decision thereon,” the 13th schedule of the Andhra Pradesh Reorganisation Act, 2014, says.
    Residuary Andhra Pradesh is coming to terms with the loss of Hyderabad, the state capital and economic and industrial nerve centre that will be transferred exclusively to Telangana after serving as a joint capital for 10 years.
    The petroleum, chemicals and petrochemicals complex that is being built is expected to be a top draw for future investors. Once the project takes off, the state government is expecting an investment of Rs.3.43 trillion and jobs for 1.2 million people.
    “HPCL’s investment is crucial for success of PCPIR, which will help in rapid industrialization and employment generation in Andhra Pradesh,” said J.S.V. Prasad, principal secretary, industries and commerce, in the Andhra Pradesh government.
    HPCL’s Kumar said state-owned gas producer GAIL (India) Ltd is also expected to come on board the project.
    “We are in advanced talks with GAIL. Formal understanding with GAIL will be reached in next one month or so,” he said, adding that HPCL was also looking to enlist a foreign partner to supply crude oil and help in setting up the cracker unit.
    HPCL has an existing refinery in Visakhapatnam with a capacity of 9 mtpa and plans to expand that project’s capacity to 15 mtpa in the next three-four years.
    HPCL has sought a 5,000 acre alternative site near Nakkapalli mandal in Visakhapatnam district, other than 1,500 acres that was offered to the refiner initially. “We are prepared to consider their request,” Prasad said.
    He said the government has so far acquired 15,000 acres of land for PCPIR between Visakhapatnam and Kakinada.
    The state and centre will be investing around Rs.10,000 crore to augment internal and external infrastructure that includes setting up manufacturing and service facilities for domestic and export-led units, upgrading roads and railway links, and improving air and sea connectivity.
    The PCPIR project hasn’t been free of controversy. Farmers have complained that the compensation provided by the state to acquire their land for the project was inadequate, and environmental activists have expressed concern about its impact on the sensitive coastal ecosystem.
    “The environmental impact assessment is on. We expect environmental clearance to be given by early next year,” Pal said.
    The PCPIR includes special economic zones (SEZs), industrial parks, free trade and warehousing zones, and export-oriented units to attract domestic and export-led production units in petroleum, chemicals and petrochemicals areas.
    The Union government has sanctioned three more PCPIRs—at Paradip in Odisha, Dahej in Gujarat and Nagapattinam in Tamil Nadu.
    Pal said the contribution of chemical industries to gross domestic product for 2012-13 was 2.11% and these account for 15% of manufacturing. The total size of India’s chemical industry was $140 billion in 2012-13.

    HPCL refinery may be boost for Andhra Pradesh fortunes - Livemint
  3. Srinivas_K

    Srinivas_K Senior Member Senior Member

    Jun 17, 2009
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    Billions Coming AP's Way, Thanks to HPCL Project

    HYDERABAD: The long-pending Visakhapatnam-Kakinada Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR) is likely to take shape with the State-run Hindustan Petroleum Corporation Ltd (HPCL) relooking its earlier proposal to set up a greenfield refinery-cum-petrochemical complex. The project may encompass investments to the tune of $10-12 billion.

    According to senior company officials, HPCL is roping in another public sector major GAIL India and an MoU is likely between both next month. This is the first major industrial investment being announced in Andhra Pradesh after bifurcation of the State.

    The proposal was made originally in 2008 but didn’t take off due to economic downturn. “We are in talks with GAIL for a possible tie-up and we expect a formal understanding by next month,” said H Kumar, executive director, Corporate Strategy & Planning, HPCL. Speaking to newsmen here Thursday, he said the company was also in the process of conducting a feasibility study and an environment impact assessment for the proposed 15 mmtpa refinery in PCPIR, expected to be completed in six months.

    Besides setting up a new refinery complex, HPCL will also expand capacity at its refinery in Visakhapatnam from the current 8.3 mmtpa to 15 mmtpa. “This expansion will require investments of about `5,000-6,000 crore spread over 3 to 4 years,” he said.

    HPCL operates two refineries one located in Mumbai and one in Visakhapatnam.

    Meanwhile, the AP government said it was considering allotment of land to HPCL for the greenfield plant in Visakhaptnam-Kakinada PCPIR, which is the longest petro chemical corridor in the country. ‘’We have land and if they (HPCL) want 3,000 or 5,000 acres we will allot them as per the project proposal,” said JSV Prasad, Principal Secretary, Industries and Commerce.

    Meanwhile, the Department of Chemicals and Petrochemicals will submit a draft national chemical policy to the Central government shortly.

    According to Indrajit Pal, Secretary (Department of Chemicals and Petrochemicals), under the Ministry of Chemicals and Fertilizers, there exists an import-export imbalance and the proposed policy will bridge the gap. ‘’We have grown from $110 billion to $140 billion in a span of two years.

    The objective of the policy is to make it grow further. The imports are about Rs 2.34 lakh crore and exports are in the range of Rs 1.78 lakh crore. We need to bridge the gap. We need to increase domestic production,” he said.

    Billions Coming AP's Way, Thanks to HPCL Project - The New Indian Express

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