State run HPCL and Rajasthan government today inked a revised MoU of Rs 43,129 crore for an oil refinery in Barmer district which will produce BS-VI fuel. The work on the refinery will commence in the current financial year and will complete in next four years, Union Oil Minister Dharmendra Pradhan told reporters here. It will be the largest industrial investment in the state, the minister said further. Under the new terms and conditions, the refinery cost has come down to Rs 16,845 crore, which was Rs 56,040 crore in the previous MoU done by the Congress government in 2013, Pradhan said. “It was a direct loss of Rs 40,000 crore to the state of Rajasthan in 15 years. In the previous MoU, the state had to give Rs 3,736 crore interest free loan every year for 15 years, which would have burdened the state finances,” Pradhan told reporters after signing of the MoU.
Some facts about HPCL Barmer Refinery:
- Rajasthan government will have 26% stake in the refinery project while HPCL will have the rest shareholding.
- HPCL, in March 2013, had signed an MoU with the Rajasthan government for setting up the refinery-cum-petrochemical complex in the Thar desert near the oil discoveries made by Cairn India
- The refinery however never took off as a Government changes in state and new government putting on hold the fiscal incentives for the project.
- HPCL, that had to spend Rs 37,230 crore under the previous deal, will now spend Rs 43,129 crore.
- Refinery will produce BS-VI emission norms compliant fuel. The government plans to move to BS-VI emission norms by 2020.
- Oil field permission had to end in 2020 but we have provided permission to the refinery to run for 10 more years.
- Apart from 43,129 crore, additional Rs 27,000 crore investment will be made in the refinery, oil field and petro-chemical complex. Overall, Rs 70,000 crore worth investment will be made in next four years.