Indian Oil Corporation (IOC) will hold 75% equity in the proposed 9 million tonne grassroots refinery in Tamil Nadu’s Nagapattinam with subsidiary and joint venture partner Chennai Petroleum Corporation (CPCL) holding the remaining stake in the project whose cost has been revised upwards by ₹3,662 crore.
Revision in the cost of the Cauvery Basin Refinery and Petrochemicals (CBRPL) project from ₹29,361 crore to ₹33,023 crore as well as change in the capital structure of the JV — with 75% for the oil major and 25% for CPCL — was approved by its Board, Indian Oil said in a filing on Thursday. It, however, did not cite reasons for the increase in the cost.
As per the earlier proposal, Indian Oil and CPCL were to split 50% equity equally with financial/strategic and public investors holding the remaining 50% stake in the refinery project conceived to replace the 1 MT refinery of CPCL in Nagapattinam and meet the growing demand for petroleum products in southern India. The refinery will produce petrol and diesel conforming to BS-VI specifications and Polypropylene as a value-added product.
In its annual report for 2022-23, CPCL had said detailed feasibility report for the new refinery project has been completed and the facility will produce LPG, aviation turbine fuel besides petrol and diesel. The project also includes a polypropylene unit as part of petrochemical integration with potential to further increase production of petrochemicals in future. Single point mooring and desalination plant are envisaged for crude import and refinery water requirement respectively. The company has signed an MOU with Tamil Nadu government for availing structured package of incentives for the project, it said.
Prime Minister Narendra Modi had laid the foundation stone of the refinery project in February 2021.
