Saudi keen to have stake in west coast, Kakinada project: Oil Minister


World’s largest oil company Saudi Aramco is interested in acquiring a stake in India’s proposed Rs 1.8 lakh crore refinery in Maharashtra and a Rs 33,000-crore petrochemical complex in Andhra Pradesh, Oil Minister Dharmendra Pradhan said on Friday.

After talks with Saudi Arabia’s Energy Minister Khalid A Al-Falih, he said the oil kingpin is also interested in partnering in the second phase of strategic oil reserves India plans to build shortly.

“We have moved beyond mere envisaging of interest and now modalities are being discussed,” he said without elaborating.

Besides Aramco, Abu Dhabi National Oil Co (ADNOC) has also showed interest in the world’s biggest refinery-cum-petrochemical complex that India plans to build in Maharashtra. State-run Indian Oil, Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) are partners in the 60 million tonnes and adjacent petrochem complex.

In Kakinada, state-owned HPCL and GAIL India are looking at building a 1.5 million tonnes capacity petrochemical complex at the cost of Rs 33,000 crore. “They are more than interested,” he said. Pradhan said Saudi Arabia is India’s most reliable partner, supplying close to a fifth of country’s oil needs. Saudi Aramco, the Gulf nation’s flagship oil firm, sells 36.5 million tonnes of oil annually to India.

It had previously been interested in new greenfield refineries set up in India but none of the interests materialised in investments. The world’s biggest oil producer was interested in the 9 mt Bhatinda refinery but exited the project in 1998. Thereafter, the refinery was set up by HPCL in joint venture with steel baron Lakshmi N Mittal. Saudi Aramco had also initially shown interest in IOC’s 15 mt Paradip refinery in Odisha but walked out of the project in 2006. The Indian Oil Corp (IOC) set up the refinery on its own thereafter. The refinery-cum-petrochemical complex on the west coast is expected to be commissioned by 2022. Pradhan said also discussed during talks was the 6 million tonnes capacity strategic oil storage planned in second phase.

ADNOC has filled half of the 1.5 million tonnes capacity underground oil storage at Mangalore that was built as part of Phase-1 of Strategic Petroleum Reserves (SPR) programme, he said.

In phase-I, 5.33 million tonnes of storage capacity, enough to meet country’s oil requirement of 10 days, has been built. He said the plan for phase-II will shortly go to the cabinet for approval.moneycontrol