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ONGC shelves plans for greenfield refinery

NEW DELHI: The slowdown in the economic growth has led to Oil and Natural Gas Corporation (ONGC) deciding to shelve plans to build a new 15-million tonne refinery adjacent to its subsidiary Mangalore Refinery and Petrochemicals Limited (MRPL).

MRPL had planned to build a 15-million tonne a year greenfield refinery and a mega petrochemical complex after expanding its current unit to similar capacity by October 2011. “These plans are not being pursued as after a review of the situation we concluded that MRPL balance sheet does not have the strength to support a greenfield refinery,” ONGC Chairman and Managing Director R. S. Sharma said here on Saturday. However, MRPL will continue to work on expanding its current 9.69 million tonne unit to 15 million tonnes by October 2011 at a cost of Rs. 12,412 crore. ONGC had, in June last year, made an exit from a similar Rs. 25,600-crore grassroots refinery project at Kakinada in Andhra Pradesh.

ONGC, through its subsidiary MRPL, was to hold 46 per cent stake in the Kakinada refinery and Petrochemicals and 26 per cent in Kakinada special economic zone (SEZ). The company has walked out of both the projects.

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