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States look to oil firms for new industrial zones

Gujarat, W Bengal, AP and Karnataka have set the ball rolling for mega petrochemical and petroleum investment regions, reports G Choudhury.

business Updated: Aug 10, 2008 23:10 IST
Gaurav Choudhury

Four states — Gujarat, West Bengal, Andhra Pradesh and Karnataka — have set the ball rolling for mega petrochemical and petroleum investment regions (PCPIR), largely anchored around existing projects of public sector oil companies.

The PCPIR policy was launched in May last year and the government is anticipating an overall investment of $20 billion.

The region would be specifically delineated investment area for manufacturing facilities for domestic and export-led production in petroleum, chemicals and petrochemicals along with associated services and infrastructure.

The Gujarat government has proposed a 453 square kilometre (sq km) PCPIR spread across Dahej, Bharuch and South Gujarat centred on the multi-feed cracker project of Oil and Natural Gas Corporation (ONGC).

ONGC Petro Additions Ltd (OPaL), a joint venture company promoted by ONGC and Gujarat State Petroleum Corporation, is setting up a multi-feed cracker plant involving an investment of Rs 13,000 crore.

ONGC is also setting up an oil extraction plant at Dahej at an investment of Rs 3,400 crore. A petrochemical special economic zone (SEZ) is planned in the proposed PCPIR called the Dahej SEZ. It will be a joint venture between ONGC and Gujarat Industrial Development Corporation.

The West Bengal government has plans for a 164 sq km PCPIR in Haldia, comprising a mainland and an island segment. The zone would be anchored to Indian Oil Corporation's (IOC's) planned 1.7 million tonne hydro-cracker unit at the existing Haldia refinery. IOC is also planning a new 15 million tonne refinery in Haldia.

The Karnataka government has plans for creating a 250 sq km PCPIR in Dakshina Kannada and Udipi districts anchored to the existing Mangalore Refinery and Petrochemicals Ltd.

ONGC and MRPL is planning an integrated petrochemical complex by 2010 at an investment of Rs 35,000 crore within the region.

The Andhra Pradesh government has proposed to set up a 603 sq km PCPIR along the coastal stretch spreading from Vishakapatnam port in the north to Kakinada deep water port in the south.

The zone will be anchored to a mix of existing and upcoming projects, including ONGC’s planned Rs 26,000 crore 15 million tonne oil refinery in Kakinada. ONGC is also investing about Rs 20,000 crore in the gas rich Krishna-Godavari basin.

In addition, Hindustan Petroleum Corporation Ltd has signed an agreement with Mittal Energy and Total of France to set up an integrated refinery-cum-petrochemical complex with an investment of Rs 32,000 crore.