The Hindu : National : India-Saudi Arabia tie-up planned in oil refinery project

Online edition of India's National Newspaper
Thursday, Mar 31, 2005

National

National

India-Saudi Arabia tie-up planned in oil refinery project

By Our Special Correspondent

NEW DELHI, MARCH 30. India may collaborate with Saudi Aramco in setting up a 20 million tonnes per annum grassroots refinery in Saudi Arabia. In return, the Saudi Government has agreed in principle for investment in Indian refineries.

Preliminary talks have been held during the Petroleum Minister Mani Shankar Aiyar's current visit to that country. According to Mr. Aiyar, further discussions will now be held by the Chairman of the Hindustan Petroleum Corporation Limited (HPCL), M.B. Lal, and other senior officials.

Addressing a teleconference from Riyadh after talks with his Saudi counterpart, Ali Al-Naimi, Mr. Aiyar said Saudi Arabia had also assured that it would continue to meet India's full crude oil requirements over the next two decades. Though the system of annual term contracts would continue, the Saudi authorities said these would remain evergreen despite sharp increase in demand expected from India. He said imports were expected to double from 24 million tonnes annually to about 50 million tonnes after 20 years, but Saudi Arabia assured that it would meet the country's full requirements.

As for the proposed refinery project at Yanbu, Mr. Aiyar said discussions would now take place to finalise the modalities for the collaboration. It would be an export-oriented refinery with some of the production earmarked to meet India's demand and the balance for supplying to other global markets. Simultaneously, Saudi Aramco would consider collaborating in HPCL's Visakh refinery. Prospects for investing in Indian Oil Corporation's Paradeep refinery project would also be explored.

In the area of natural gas, the Minister said the two countries had agreed to further explore possibilities for India's involvement in the development of gas fields as well as in the downstream value chain. Petrochemicals and liquefaction of natural gas for transport as LNG were among the areas being considered for such cooperation.

Printer friendly page
Send this article to Friends by E-Mail

National