Cuddalore Refinery set to take off

By Alok Agarwal | 26 Sep 2001

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Mumbai: The Cuddalore Refinery, primarily promoted by Nagarjuna Oil Corporation, is finally set to take off what with Oman Oil Corporation agreeing to pitch in with a 26-per cent stake.

Oman Oil Corporation is owned by the Government of Oman and is the biggest petroleum company in Oman. The other major shareholders in the refinery are Hyderabad-based Nagarjuna Fertilisers and Chemicals and the Tamil Nadu Industrial Development Corporation (TIDCO).

While Nagarjuna Fertilisers already holds a 51-per cent stake in the company, having bought in Rs 450 crore out of its total obligation of Rs 600 crore, TIDCO is likely to pitch in 11-per cent stake. With this, the Cuddalore Refinery has already tied up 88 per cent of its equity requirement.

The Cuddalore project proposes to set up a 6 million tonne per annum petroleum refinery in Tamil Nadu. The project plans to use equipment of Mobil Refinery located in Woerth, Germany, and integrate it with new balancing equipment and process units. The Rs 3,480-crore project plans to structure finances in the debt-equity ratio of 2:1.

The company is said to have already tied up the debt part. The rupee portion of the debt is to come from a consortium of financial institutions led by IDBI while the overseas debt portion is to be organised by KFW, Germany.

If everything goes in line with the plans, the construction of the refinery will begin sometime in the first quarter of calendar 2002.

And what about the rest of the equity? Who will invest in it? While there are no confirmations, sources said a number of big players like the Indian Oil Corporation and PDVISA, the largest crude oil producer in Venezuela, may pick up the remaining stake in the company

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