IndianOil eyes overseas funds for Paradip project
New Delhi   19-Mar-2009
<b>Domestic funding of Rs 9,800 crore by SBI-led consortium</b> IndianOil plans to raise almost Rs 15,000 crore from the domestic and external markets to part finance its grassroots refinery complex at Paradip, Orissa. The company's board at a recent meeting has approved a final investment of Rs 29,777 crore for the project. Speaking to Business Line, Mr. B.N. Bankapur, Director (Refineries), IndianOil, said, "We have got our board's nod for Rs 29,777 crore investments in the 15-million-tonne refinery project the domestic funding of Rs 9,800 crore is being done by a SBI-led consortium of 20 banks and the Rs 4,000-5,000 crore will be raised through external markets." <b>Foreign Funds</b> The external funding would be mainly used for buying equipment for the project, which would be sourced from die international market, he said. Mr. Bankapur, however, did not give any timeline for the company tapping the external market for the project which is the single largest investment undertaken by IndianOil at one location. Agreeing that setting up of an integrated refinery-cum-petrochemical project was a better proposition; Mr. Bankapur said, “IndianOil had to de-link the petrochemical project from the refinery project at Paradip due to cost escalation.” <b>Project Cost</b> The total project cost (refinery-cum-petrochemical) is estimated to be Rs 54,000 crore. "Besides, the magnitude of work for setting up integrated infrastructure is huge. Consultants were not available who could tackle such a huge project. In phase one, the-company is implementing the refinery project and would implement the petrochemical project next," he said. Even the refinery project, which is under implementation, would be commissioned in phases. In the initial phase the primary unit of the refinery crude distillation unit and naphtha cracker, sulphur recovery unit and diesel hydro treater will be commissioned by March 2012. The complete commissioning of the refinery is expected by June 2012.