MRPL to raise Rs 5,200 cr debt to fund expansion plan

22-Sep-06

ONGC's subsidiary, Mangalore Refinery and Petrochemicals Ltd (MRPL), plans to raise an estimated Rs 5,200 crore in debt market to part finance the expansion of its refining capacity to 15 million tons. The project is to be funded in debt-equity ratio of 2:1. The initial capital requirement would be from internal accruals and about Rs 5,200 crore debt would be raised in 2008. Naphtha produced at the expanded MRPL would be the feedstock for producing paraxylene and benzene. Around 2 million tpa of Heavy Naphtha would be the feedstock to produce 0.95 million tpa of Paraxylene and 0.l5 million tpa of Benzene, the rest being LPG, gasoline pool feed and tail gas. The Petrochemicals Complex would be executed through a Special Purpose Vehicle (SPV) of ONGC. ONGC would hold 46% stake in the SPV, MRPL would hold 3%. The balance 51% would be with financial institutions and banks. The Aromatics project would be completed in 3 years after finalisation of the process licensor and engineering, expected in a years time. MRPL also proposes to set up an Olefin complex, for which state-owned Engineers India Ltd (EIL) has been asked to prepare a detailed feasibility report. The proposed Olefin Complex would use naphtha and propylene to produce polymers like high-density polyethylene (HDPE), linear low-density polyethylene (LLDPE), polypropylene and mono-ethylene glycol.