AP, ONGC sign MoU for a new refinery

4 September 2005

HYDERABAD -- The government of Andhra Pradesh and the public sector giant Oil and Natural Gas Commission (ONGC) yesterday signed a memorandum of understanding for the promotion of a special economic zone and export oriented refinery at Kakinada involving an investment of Rs 6500 crore.

The MOU was signed by the Chief Minister Y S Rajasekhara Reddy and the ONGC Chairman Subir Raha on Saturday evening. The Mangalore Refinery Limited, a subsidiary of ONGC will also be involved in this massive project.

The investment in the export oriented refinery will be about Rs 5500 crore and in the special economic zone will be around Rs 1000 crore, the Chief Minister said.

''This is the largest investment in the last ten years'', he added.

Assuring the full cooperation of the state government in executing both the projects, the Chief Minister said that the state was providing 1000 acres of land for the refinery and ten thousand acres for the Special Economic Zone around the port city of Kakinada in East Godavari district.

The ONGC is one of the companies which are exploring oil and gas in off shore and on shore area of Andhra Pradesh.

The ONGC chairman Subir Raha said that the work on the refinery will begin by the end of this year and it will be ready in 36 to 40 months.

''We are importing a ready made refinery from Europe for this project,'' he said. It will be developed in to a model refiner in the country, Raha said.

The refinery will have a capacity of five million tons which will be later increased to 7.5 mt, he said.

Raha said that the products from the refinery will largely be exported to the European markets.

FROM A CORRESPONDENT