HPCL scraps plan to build refinery in Andhra Pradesh

NEW DELHI: Hindustan Petroleum Corp has shelved a plan to build a refinery in Andhra Pradesh, although it will go ahead with a proposed petrochemical unit, the company’s chief said. “We will just do the petrochemical plant,” said Nishi Vasudeva, chairman and managing director of HPCL, adding that the company’s refinery at Visakhapatnam is being almost doubled, obviating the need to add capacity in the state at present.

State-run HPCL will build the petrochemical plant in partnership with GAIL Ltd, the government-owned gas distributor. The two companies had discussed the possibility of setting up a refinery-cum-petrochemical complex for years, but the inability to find foreign partners to fund the project has kept the plan from taking off.

"It’s early days," Vasudeva said, adding there was no final decision on inducting a foreign partner, a funding plan or even an equity structure between GAIL and HPCL for the project.

An executive at GAIL, which runs gasbased petrochemicals units, said the company was working with HPCL on this and a final plan will take some time to get ready. The two companies have evaluated the prospects of setting up a refinery-cum-petrochemical complex costing Rs 85,000 crore-95,000 crore.