27% hike in costs as ONGCs targets completion of delayed Dahej petrochem plant by June 2015

22-Sep-14

State-owned Oil and Natural Gas Corp's (ONGC) long-delayed mega petrochemical plant at Dahej in Gujarat will be commissioned by June next year but at 27% higher cost of Rs 27,122 crore. ONGC had in 2006 set up ONGC Petro-additions Ltd (OPaL) for building a mega petrochemical complex at Dahej in Gujarat. The plant was originally planned to come on stream by end 2012 but delays have led to two revisions in completion dates. "Pre-commissioning activities have started at Dahej. The plant will be mechanically complete by April 2015 and commercial operations will start by June 2015," ONGC Chairman and Managing Director Dinesh K Sarraf said. The 1.1 mln tons plant was in 2006 estimated to cost Rs 12,440 crore. But since then the project cost has been revised thrice - first to 15,870 crore in end 2008, then to Rs 19,535 crore in June 2010 and to Rs 21,396 crore in August 2012. The project cost has undergone further cost-escalation and completion cost is now estimated at Rs 27,122 crore. f the additional cost, about Rs 3,192 crore is due to interest during construction and another Rs 1,592 crore on account of startup and commissioning expense. Foreign exchange variation cost Rs 460 crore and another Rs 482 crore was due to change of project scope.