State-run Oil and Natural Gas Corporation Ltd (ONGC) is evaluating various models for its proposed greenfield refinery and petrochemical complex, including setting it up independently, through a subsidiary, or in partnership with foreign players, people familiar with the matter said.
“The project is in the initial stage as of now; we are deciding the working model. A number of other specifications, such as the location and configuration of the refinery, will be worked out later,” a senior company executive said.
The proposed refinery is also likely to have a higher petrochemical intensity, in line with rising domestic demand, the official said. The detailed feasibility report (DFR) will assess the refinery’s petrochemical configuration and potential, the official added.
Questions sent to ONGC remained unanswered.
The proposed greenfield refinery project assumes significance for ONGC's larger diversification and integration plan. The details regarding capacity and investment requirements for the project would be firmed up once the DFR is ready.
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Indian oil companies are pursuing a mix of greenfield refinery projects and expansions of existing plants to raise the country’s overall refining capacity. Earlier this month, Oil Minister Hardeep Singh Puri said that India’s refining capacity of 267 million tonnes annually helped ensure fuel availability despite supply disruptions during the peak of the West Asia conflict. The country’s refining capacity is expected to rise to 320 million tonnes annually by 2030, he added.
Countries such as Saudi Arabia and the United Arab Emirates (UAE) have also shown interest in investing in upcoming Indian refinery projects, provided they see meaningful returns on their investments, Puri said.
Meanwhile, state-run Bharat Petroleum Corporation Ltd (BPCL) is developing a 9 million tonnes per annum (mtpa) greenfield refinery-cum-petrochemical complex at Ramayapatnam in Andhra Pradesh, with final environmental clearance expected soon. Indian Oil Corporation Ltd (IOCL), along with its subsidiary Chennai Petroleum Corporation Ltd (CPCL), is setting up a 9 mtpa greenfield refinery in Nagapattinam, Tamil Nadu, with a greater focus on meeting rising demand for petrochemicals.
In July, HPCL commissioned a 9 mtpa greenfield refinery-cum-petrochemical complex in Rajasthan. Several refineries in India are also undergoing [sentence incomplete in original copy].
ONGC is also exploring a role in India’s strategic petroleum reserve (SPR) programme as the country seeks to expand crude oil storage capacity. India currently has 5.33 million tonnes of SPR capacity across Visakhapatnam, Mangaluru and Padur, while another 6.5 million tonnes is planned under Phase II.
ONGC has received approval to develop a 1.75-million-tonne strategic petroleum reserve at Mangaluru, Karnataka, as an extension of the existing SPR facility. The project, estimated to cost around Rs 7,000 crore, will be developed and financed by ONGC. About half of the storage capacity is expected to be reserved for strategic use, while the company has sought government approval to commercially utilise the remaining capacity. ONGC has already acquired land for the project.