The beleaguered Bina refinery project of public sector Bharat Petroleum Corporation Ltd (BPCL) has received a shot in the arm with the Gujarat government planning to take a favourable decision on the Vadinar-Bina crude oil pipeline shortly.
An assurance to this effect was given by Gujarat Chief Minister Keshubhai Patel to minister of state for petroleum and natural gas Santosh Gangwar recently.
The minister, along with a delegation comprising BPCL chairman U Sundrarajan and senior officials of the ministry, had met the Chief Minister to press for an early environmental clearance for the pipeline that will pass through a marine park of the state.
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Official sources told Business Standard that Patel was quite positive in his response and said the state government would take an expeditious decision so that the project could be implemented without further delay.
The Union ministry for environment and forests has also convened a meeting here on Friday to discuss the situation arising out of a Supreme Court order on the issue.
The meeting, which will be attended by Gujarat government officials as well as officials of BPCL and the petroleum ministry, will discuss if the Supreme Court directive prevents the implementation of the project.
The Rs 6,562 crore six million tonne per annum refinery project was initially conceived as a joint venture between BPCL and Oman Oil Company (OOC). Both BPCL and OOC had proposed to hold 26 per cent equity each in the project.
However, OOC later decided to limit its participation in the project to a mere three to four per cent.
It has now been decided by the petroleum ministry that while BPCL would have 50 per cent equity in the project and OOC three to four per cent, the balance would be offered to the public, financial institutions and banks.
As BPCL does not have any refinery in central and northern India, it has pinned its hopes on the Bina refinery for its supplies post deregulation of the oil sector.
Though it was reluctant to put up the refinery on its own, it has been forced to do with OOC refusing to participate in its equity in any significant manner.
The project was approved by CCEA in December 1995 at an estimated cost of Rs 5,277 crore. However, the cost estimates which were revised in January 2000, put the cost at Rs 6,562 crore.
The project facilities comprise a single point mooring, crude oil terminal with connecting sub-sea and onshore pipeline at Vadinar in the Gulf of Kutch, including a 935 km cross-country crude oil pipeline from Vadinar to Bina, and a six million tonnes refinery at Bina for production of all normal fuels and lube base stock.