Mittal pays initial Rs 500cr for Bhatinda refinery

India-born billionaire Lakshmi N Mittal today made a payment of Rs 500 crore as the first instalment for picking up 49% stake in HPCL's Rs 18,919 crore Bhatinda refinery.

Mittal Investments chairman L N Mittal today handed over a cheque of Rs 500 crore to HPCL chairman and managing director Arun Balakrishnan here.

Mittal Energy Investments Pte, a subsidiary of Mittal Investments, has parked $110 million in an escrow account as guarantee for its 49% stake in the nine million tonne Bhatinda refinery project. The project is being financed with a debt-equity ratio of 1.5:1. Total equity investment by Mittal and HPCL would be Rs 3,577.50 crore each.

Mittal said Arcelor Mittal is committed to setting up 10 million tonne steel plants in Jharkhand and Orissa, and the central government has assured him allocation of iron ore mines.

He added that the company has got assurance for allocation of coal mines for setting up captive power plants for the projects. "Yes, we are 100% cent committed to the two projects," Mittal told reporters.

Asked about the delays in securing iron ore and coal mines for the project, he said: "This is the first time after the Vizag steel plant that such a large investment has been announced. The government was not geared up for such large investments and the concessions needed thereof. It has been a learning experience for them, and they are now fully committed to supporting these projects."

Mittal is also meeting Orissa and Jharkhand Chief Ministers, and is expecting full support from them in allocation of iron ore mines for the steel plants, coal mines for setting up captive power plants and land for the projects.

Asked when the projects are expected to be completed, he said: "I don't know that."