The Telegraph
Since 1st March, 1999
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IOC to anchor chemical hub

Calcutta, June 13: Bengal’s dream to make Haldia a chemical hub started its journey towards reality today with the Indian Oil Corporation agreeing in principle to become the anchor investor in the project.

Petroleum minister Murli Deora had a meeting with chief minister Buddhadeb Bhattacharjee and industry minister Nirupam Sen to discuss the public sector company’s involvement in the chemical hub.

“It is a beginning, but I can say it is a good beginning,” Bhattacharjee said after the talks with Deora, petroleum secretary M.S. Srinivasan and IOC chairman Sarthak Behuria.

Deora, who stopped over in Calcutta for the night en route to Shanghai for an Asian oil summit, also announced IOC’s intention to pump Rs 3,000 crore into its Haldia refinery to develop a number of downstream projects.

There is also a proposal to expand the refinery itself.

“The state government has requested IOC to double the capacity of the Haldia refinery to 15 million tonnes. But it would be difficult to evacuate such a huge amount of production from there. We must have something where they can be utilised,” Srinivasan said.

IOC, therefore, has linked the capacity increase to a leading role in Haldia Petrochemicals Ltd (HPL). It wants to progressively increase its stake in HPL to eventually take over the management.

Srinivasan said IOC wanted to first step up its holding to a strategic level ' 26 per cent and above ' and then develop majority stake, 51 per cent and above.

It now has a 7.5 per cent stake in HPL where the two principal promoters, the Bengal government and The Chatterjee Group, are locked in a bitter battle for control. The government has offered to buy out Purnendu Chatterjee.

The disputed oil price increase was also discussed at the meeting.

“I have already written a letter to the chief minister requesting the state government to cut sales tax on petrol and diesel. Many states have done so. But Left parties say that the Centre should do it. They should practise what they preach,” Deora said before going into the talks.

Congress-ruled states have foregone the extra sales tax from the price hike, but Bengal has refused to do so. The state will earn 30 and 85 paise more in sales tax for every litre of diesel and petrol after the increase.

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