India has increased the cost estimate of the planned refinery and petrochemical project to be jointly built with Saudi Aramco and Abu Dhabi National Oil Co by more than 36%, after protests by farmers forced the relocation of the plant, as reported by Business Today.
The 1.2 million bpd coastal refinery in the western state of Maharashtra is now expected to be built at Roha in the Raigad district, about 100 km (62 miles) south of financial capital Mumbai.
The new cost estimate of $60 billion for the refinery was given to Saudi Arabia’s energy minister Khalid al-Falih at a meeting with Indian Oil Minister Dharmendra Pradhan last month in New Delhi, the report stated.
The project cost at the signing of a deal with Saudi Aramco in 2018 was estimated at $44 billion. Despite the cost expansion, the project is still expected to be commissioned in 2025, the report added.
As the world’s third-largest crude oil importer, India is aiming to raise its refining capacity by 77% to 8.8 million bpd by 2030.
State run companies – Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum – own 50% of the Ratnagiri Refinery & Petrochemicals Ltd (RRPCL), the company building the project. Saudi Aramco and ADNOC hold the remaining half.
Saudi Aramco is also in talks to buy a minority stake in Reliance Industries’ refining, marketing and petrochemical business, and analysts say any further delay in land acquisition may force it to take a harder look at the private Indian refiner’s assets.
