 "Rajasthan wants more share of domestic crude in proposed refinery")
The terms and conditions for the joint venture are being reworked wherein the primary demand is to increase the stake of the state which is currently at 26%.
Besides, the state wants to bring down the amount of interest free loan committed for a period of 15 years. The state government as per the terms signed during the Congress-led Ashok Gehlot government had agreed to provide an interest free loan of RS 3,736 crore annually for 15 years from the date of commissioning the refiner-cum-petrochemical complex at Pachpadra in Barmer.
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However the present government wants the share of crude to be refined which is currently maintained at 50:50 for domestic and imported crude to change in favour of domestic crude to bring down the total project cost. Explaining this, an official said, "instead of 50:50, the Rajasthan government wants the share of domestic crude to be refined be increased to 80-90% and rest imported."
However this proposal is under consideration of the Ministry of Petroleum and natural gas. One of the concerns is that every refinery has to have a fair share of domestic and imported crude to balance the cost.
On the other hand, imported crude is costlier and will affect cost of any refinery which increases the share of imported crude. According to the state government, Barmer has the potential of producing much of the domestic crude needed, officials said.
A high level meeting took place between HPCL and state government led by the chief minister to sort out issues for starting the refinery. The nine-million tonne refinery with the projected cost of Rs 37,230 crore is yet to receive the environmental clearance as well.
Meanwhile, the state has already transferred 4,000 acres needed for the project to us and HPCL is in the process of doing the design work and a lot of field surveys.
As per an estimate made in 2013, oil wells in Barmer are ready to produce approximately 3 lakh barrels oil per day which will significantly increase revenue for the state.
The oil & gas discoveries in the state started with Saraswati field that was the first oil discovery in 2001 followed by Raageshwari field discovery in 2003. In January 2004, Cairn discovered the Mangala field, the largest onshore oil discovery in India in more than two decades.
This was followed by discovery of Aishwariya & Bhagyam fields.
The Mangala, Bhagyam and Aishwariya (MBA) fields (including Enhanced Oil Recovery (EOR) potential) have gross ultimate recoverable oil reserves and resources of approximately one billion barrels.
This is (at $100 per barrel price / INR 5,000) equivalent to $100 billion in value (INR 5 lakhs crores), as per an estimate of the central ministry.