State, HPCL ink fresh ₹43,129cr refinery deal , ‘to save ₹40,000 cr’
MEGA INVESTMENT State to have 26% stake in Barmer project; HPCL will have rest shareholding
The Rajasthan government and the Hindustan Petroleum Corporation ltd (HPCL) Tuesday signed a fresh memorandum of understanding (MoU) for setting up a 9 million metric tonne (MMT) per annum capacity refinery-cum petrochemicalcomplex at Pachpadra in Barmer district of the state.
With this, the road has been cleared to resume work on the project, four years after it was first announced. The HPCL Rajasthan Refinery Limited, a joint venture between the HPCL and the state government, will build the refinery at an estimated cost of ₹43,129 crore.
The state has already allotted 4800 acre land in Barmer for the project. Expected to be set up within four years of getting all the mandatory approvals, the refinery will be the first in India to meet Bharat Stage-VI (BS-VI) specifications. It will produce BS-VI emission norms compliant fuel petrol and diesel apart from petrochemical byproducts such as polypropylene and polyethylene.
Hailing the move, Union Minister for Petroleum and Natural Gas Dharmendra Pradhan said, “Rajasthan is touching new dimensions under Vasundhara Raje’s leadership. The refinery is a big gift to eight crore people of Rajasthan, and to both the governments at Centre and in the state.”
Hitting out at the opposition Congress, Pradhan said earlier the oil produced in state was processed elsewhere and Rajasthan only GOT the royalty. “Just to win elections, people’s rights were neglected. Former CM Ashok Gehlot should answer, which is more – ₹3,736 crore or Rs 1,126 crore. It is Raje who negotiated the deal in state’s interest,” Pradhan said.
He was referring to the money the viability gap funding (VGF) of ₹1,123 crore that the state government would provide annually to the refinery for 15 years in form of interest free loan.
Under the new terms and conditions, the interest free loan (which state government has to pay) has come down to ₹16,845 crore, which was ₹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 said.
He said government comes and goes but today’s decision is important for state youth. The untoward incident was avoided and state will have 26% stake and refinery setup on BS-VI standards.
“The investment will get the state revenue, provide employment to youth, and bring value addition industries leading to overall economic development,” Pradhan added.
He informed that for speedy implementation of the project, the Centre and the state government will create a single window and the project will be monitored every 15 days.
“Rajasthan is the biggest producer of crude oil in India, making up for the 24 per cent of country’s total produce. The refinery has come as an injection whose results will be visible in coming 5-10 years,” said Raje.
She too hit out at Congress. “Even 70 years after independence, people face problems related to electricity, water and roads. Had there been a BJP government at the Centre all these years, such a situation would have never cropped up,” she said, adding “we want to connect people with development.”
She said the result of the bypoll to Dholpur assembly seat has shown that people want to connect with dreams of Prime Minster Narendra Modi and thus voted for development.
Raje also sought Centre’s intervention in helping state tackle the problem of saline water. “If the saline water is treated, we would be able to provide it to areas which do not have access to proper drinking and irrigation water,” she said.
The chief minister urged Pradhan to hold the ground breaking ceremony for the refinery in the month of SeptemberOctober.
HPCL chairman-cum-managing director Mukesh Kumar Sharma said today HPCL was adding a new chapter in Rajasthan’s history. “We assure that HPCL will complete the project soon,” he added.
The MoU was signed by state mines and petroleum secretary Aparna Arora and Vinod S Shinoy, director refinery HPCL. All the state ministers, senior officials, MLAs, MP and other elected representatives were present.