Calcutta, Dec. 24: TotalFinaElf, the world’s fifth largest oil multinational, has entered into a joint venture with the public sector oil major, Hindustan Petroleum Corporation Ltd (HPCL) to set up a LPG storage tank at Visakhapatnam.
A senior HPCL official said the move is aimed at cornering a sizeable share in the highly promising auto-LPG business in India.
“Auto-LPG is fast going to become a very strong choice for the consumers who are currently using petrol. We are gearing up to match the demand,” he said.
The French multinational will provide equity as well as technology. The initial capacity of the storage tank, which will be built underground, is pegged at 60,000 tonnes per annum.
Once transportation through a dedicated pipeline is in place, the storage capacity may go up. The estimated cost of the project is around Rs 290 crore.
TotalFinaElf, which operates in 122 countries, has interests in both upstream and downstream projects.
Sources said, its current production strength is 2.2 million barrels of oil equivalent per day through its worldwide operations. The production of oil equivalent is supported by proven reserves of more than 11 billion barrels along with a portfolio of geographically diversified assets.
It is also a leading refiner and marketer in Europe. Sources said it has interests in as many as 27 refineries worldwide and directly operates 13 of them.
Over the years, TotalFinaElf has built up a formidable network of 16,900 service stations, mainly in Europe and Africa. This apart, the French company is also a global leader in lubricant and LPG. It sells lubricant in 112 countries and LPG in 50 countries.
The French oil major’s Indian joint venture partner, HPCL, too has a strong marketing network which it is trying to leverage for the auto-LPG sale.
HPCL is serious about the auto-LPG business. Recently, it has set up another joint venture, Bhagyanagar Gas Limited, with state-run gas company Gail. The new company plans to invest around Rs 1,000 crore in distribution and marketing of auto LPG and CNG in Andhra Pradesh.
Bhagyanagar Gas, where Gail and Hindustan Petroleum Company have equal partnership with 22.5 per cent equity, would distribute and market natural gas for use in residential, commercial, industrial, automotive and auto LPG sectors.