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| Landing trouble |
New Delhi, July 6: Indian Oil Corporation (IOC) is keen to expand its Haldia refinery by acquiring an adjoining 80-acre plot that belongs to the ailing Hindustan Fertiliser Corporation Ltd (HFCL), but the transfer is bogged down by an inter-ministerial gridlock over several contentious issues.
Sources say an inter-ministerial meeting was convened earlier this week by shipping secretary A.K. Mohapatra to work out a fresh long-term lease to hand over the 80-acre HFCL plot to IOC. The existing lease between the Calcutta Port Trust and HFCL will have to be terminated before the new lease is drawn up.
The meeting was attended by senior officials of the petroleum, fertiliser and shipping ministries apart from representatives of IOC, HFCL and Calcutta Port Trust. However, the terms and conditions have still not been worked out.
IOC also appears to be wary of Reliance Industries’ move to enter the petrochemicals sector in Bengal. IOC had a bitter experience when it lost IPCL in the west just as it was poised to take over the public sector company with which it had a strong synergy.
With Reliance emerging as a near-monopoly in the petrochemicals sector, IOC has drawn up ambitious plans to establish new capacities in the east. The Haldia refinery had started off as a small 2.5-million-tonne unit and has gradually expanded capacity over the years to 6 million tonnes of petroleum products a year.
With the Paradip-Haldia crude pipeline scheduled to be completed this fiscal, IOC will have the infrastructure to supply larger quantities of crude to the Haldia refinery. The oil major is, therefore, keen to expand the capacity of the refinery and increase profits.
However, the existing plot is already congested and the company needs to find more space for an orderly expansion so that it can space out its new units appropriately.
Safety is another factor to be considered as there has to be sufficient space between the units given the highly inflammable nature of the products and high temperatures required to produce them.
