Petrotahlil - The Odisha government on Tuesday cleared a Haldia Petrochemicals Ltd proposal to invest Rs 28,700 crore for setting up an integrated refinery and petrochemicals facility in Balasore.
A panel led by chief minister Naveen Patnaik approved the proposal. The government will allot state-owned land and consider fiscal concessions for the project, a state government official said.
“They (Haldia Petrochemicals) have sought certain concessions. We are setting up a panel to examine that,” the official said. The government, however, will not take any equity in the project.
Odisha has identified 2,000 acres for the project near the proposed Subarnarekha Port, which the state is building jointly with Tata Steel. The entire land parcel is under control of the state, though a part of it is forest area, which will need regulatory clearance for industrial use.
“Getting clearance is not insurmountable, though not easy,” the official said, adding that he expected the clearances in 10-12 months.
Haldia Petrochemicals Ltd (HPL) will invest Rs 28,700 crore in the first phase of the project that would entail a total investment of Rs 70,000 crore, the official said. The first phase is expected to be completed in five years.
“With this, we would have a big presence in oil and petrochemicals. We would be on the east coast what Gujarat is on the west coast,” the official said. “We are trying to reduce our dependence on minerals and metals.”
Indian Oil operates a 15-million-tonne refinery and petrochemical complex at Odisha’s Paradip.
The petrochemical project and the port will benefit each other. While HPL will get infrastructure to import crude oil, the Subarnarekha Port will get a big customer, the official said.
The HPL unit is planned to produce 1.6 million tonnes per annum (mtpa) of paraxylene and 2.5 mtpa of purified terepthalic acid (PTA), and light naphtha and petrol. “Setting up the PTA unit will trigger investment in these products and will catalyse growth of further downstream processing units along the value chain, driving economic growth in the region,” an official statement said.