Odisha government to sign fresh MoU with IOC for refinery project at Paradip to include fixed timeline for investment

23-Jul-13

Odisha state government has decided to sign a fresh Memorandum of Understanding (MoU) with Indian Oil Corporation Ltd (IOCL) for its refinery project at Paradip to include fixed timeline for investment at Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR).The state-run company, which is already behind schedule in building the refinery, has been postponing decision on the proposal to be anchor tenant of the PCPIR, the government alleged. The company, which has been setting up the refinery since 2000, has faced various hurdles including slump in the oil market, land and labour problems, delay in commissioning of the captive power plant and protests over laying of water pipelines from Mahanadi to the plant site. Originally envisaged to be a 6 mln tpa refinery at an estimated investment of Rs 8,300 crore, the capacity was raised to 15-mtpa later. As per the earlier commitment of the company in 2010, work on the petrochemical complex was expected to begin two years after the commissioning of the refinery. IOCL had agreed to develop a poly-propylene unit, an ethylene derivate plant as well as mixed feed cracker unit in the proposed PCPIR. Since the refinery project is already behind the schedule, the state government wanted a fresh agreement mentioning fixed deadline for the petro complex project. IOCL, however, has recently expressed confidence to commission the first phase of the refinery project by September this year.