Hyderabad-based Megha Engineering and Infrastructures (MEIL) has bagged a $648 million oil refinery project in Mongolia from Mongol Refinery State Owned LLC.
A government-to-government initiative, the EPC contract for the 1.5 million tonne refinery is the third project MEIL has secured in the Central Asian country.
Describing it as a significant deal, the company said that it will build various units of the EPC-4 refinery, from Diesel Hydrotreater, Hydrocracker, Visbreaker, HGU, Sulphur Block and LPG treating unit. It will also build utility and offsite and other enabling facilities.
A letter of agreement for constructing the crude oil refinery plant was received from the Mongol Refinery State Owned LLC. MEIL Hydrocarbons president P. Rajesh Reddy and Mongol Refinery State Owned LLC executive director Altantsetseg Dashdavaa signed the contract in Ulaanbaatar, Mongolia’s capital, in the presence of MEIL managing director P.V. Krishna Reddy, senior officials and representatives from both countries, the company said on Friday.
“The projects we undertake are instrumental in shaping economic and social outcomes. As we embark on construction of the EPC-4 refinery, it signifies India’s commitment to supporting Mongolia’s economic growth and energy security and showcases the collaborative spirit between the two countries,” Mr. Krishna Reddy said.
MEIL’s first venture in Mongolia involves construction of the country’s first greenfield Mongol oil refinery project, as part of it overseeing the construction of EPC-2, which encompasses facilities valued at $598.90 million. MEIL is also constructing captive power plants for the EPC-3 phase valued at $189.72 million. The value of the three projects is $1.436 billion.
The refinery, to produce petrol, diesel, aviation fuel and LPG, will help reduce Mongolia’s reliance on Russian oil imports and enhance the country’s energy security. It will also reduce vulnerability to fluctuations in international oil markets. The project will generate employment opportunities, bolster growth of small industries and contribute to Mongolia’s economic development in future, MEIL said.
The refinery project will be challenging since it will be executed under extreme climatic conditions — temperatures ranging from minus 35 degrees C to plus 40 degrees C, the company said.
