Calcutta, Feb. 3: A fully functional oil refinery in Germany will be dismantled, packed into 3,000 containers, shipped thousands of miles to Haldia and put back together again.
Up to 2,000 workers will be needed for the Rs 4,000-crore, two-year project that starts in the middle of the year, involving the transport of 30-50,000 tonnes of metal, concrete and other material up the Danube and across seas and oceans.
The 30-year-old plant at Ingolstadt near Munich, with a capacity of 80,000 barrels a day, will become Bengals second oil refinery after the Indian Oil Corporations existing one in Haldia.
The Ingolstadt refinery, in full commercial operation now, was sold by BayernOil to fellow German company Lohrmann International, which specialises in trading of used plants, in 2006.
Last year, Lohrmann sold it to the Delhi-based Cals Refinery Ltd, promoted by SpiceJet Airlines co-founder Sanjay Malhotra.
A Lohrmann official confirmed the sale and the scheduled transport to Haldia. He dismissed speculation that the refinery was being closed down for environmental reasons.
The plant will be shut down solely for economic reasons. It is still in full commercial operation. The technology and process equipment are meeting German rules and environmental regulations, he said.
The plant at Ingolstadt, located on the bank of the Danube, will be shut down in mid-2008. Lohrmann estimates it would take nine to 12 months to dismantle the refinery and about the same time to reassemble it.
On an average, 800 people will be deployed during the dismantling operation, the number going up to 1,000 workers at the peak of the process. The same number will be needed to put it back together.
After dismantling, the parts will be packed in crates and boxes and ferried on barges along the Danube and the Rhine-Main-Danube Canal up to a port in the North Sea. From there, a ship will carry the consignment to Colombo or Singapore. Smaller vessels will then ferry the stuff up to Haldia (see map).
If everything goes on schedule, the Cals refinery will come up towards the end of 2010.
Cals has approached the Haldia Development Authority for land for the refinery, Parwez Ahmed Siddiqui, HAD chief executive officer, said. They have approached us. We are discussing the matter with them.
Shipping used plants from other countries to India is not uncommon, but this is a first for a refinery. Sources said Cals chose Haldia because it is already a chemical and petrochemicals hub. The Buddhadeb Bhattacharjee governments pro-industry policies also encouraged it, they added.
Finished products from the Cals plant, such as petrol and diesel, will be sold nationally. By-products like naphtha, benzene and petroleum coke will cater to local industries.
If another chemical hub comes up at Nayachar, 3km from Haldia, the refinery will be a key feedstock provider for downstream industries there. The Indian Oil Corporation and The Chatterjee Group are keen to set up refineries at Nayachar.
Cals is headed by Manabendra Guha Roy, an oil industry veteran who sits on the company board as its chief executive officer. The company recently raised $200 million (Rs 786 crore) for the project.