ONGC's petrochem project in Mangalore gets PM nod

24-Aug-05

The Prime Minister's approval has ironed out all snags in the way ONGC's Rs 22,000 crore mega petrochemicals project in Mangalore. With this approval, the smooth implementation of the project has been ensured, in line with the agreement signed between ONGC, Karnataka Area Industrial Development Board and Canara Chamber of Commerce and Industry. The agreement that was signed last year, and a letter from the PMO had nominated Mangalore Refineres and Petrochemicals Ltd (MRPL) as the implementing agency for the project. However, the project could not be implemented following objections raised by the petroleum ministry that ONGC had not sought the approval of the government or the Company's Board before signing the agreement. ONGC is to provide finance and other guidelines required by MRPL and contract for importing LNG and the state government would play the role of a co-promoter of the Special Economic Zone (SEZ). The ONGC can float equity and also induct non competing financial partners but it should maintain a minimum equity of 26% and exclusive management control.