Total, partners to decide on refinery by year-end

The consortium of France’s Total S.A., L.N. Mittal Group, Hindustan Petroleum Corporation, GAIL (India) and Oil India Ltd. will take a decision to build a refinery-cum-petrochemical plant at Visakhapatnam in Andhra Pradesh by year end. Currently, the project is at the pre-feasibility stage. By the end of this year, all partners in this project will know if we are going ahead with it or not, Thierry Pflimlin, Totals senior vice-president in Asia-Pacific, said. The pre-feasibility report is looking at demand for petroleum products in India and Asia and project economies, including taxation issues. The capacity of the proposed refinery has now been reduced to 14 million tons a year, from the originally planned 15 million tons. We are looking at optimal size of the units available in the market, to ensure that there are no bottlenecks, he said. The project is estimated to cost about US$6 billion and will take about five years to complete, he added. The refinery would start operations with a focus on the export market, but subsequently may also cater to the domestic oil product market, he said. The consortium had inked a preliminary MoU in October 2007. The exact equity structure would be decided only after the feasibility studies are completed. (July 10, 2008)