HPCL looks to revive Vizag project with help of W Asia cos.

Having failed to attract European energy majors, Hindustan Petroleum Corp Ltd. has initiated talks with two West Asian oil majors for partnering in its proposed 500-bln-rupee refinery-cum-petrochemicals complex at Vishakhapatnam in Andhra Pradesh, a senior company official said.

Abu Dhabi National Oil Co and Kuwait Petroleum Corp have both shown interest in the HPCL project, which has not made any progress in the last few years due to poor financials of the refiner and general economic slowdown. 'We have had some discussions with ADNOC and Kuwait Petro,' the official said. 'They are interested, but as of now there is no firm commitment. Things will be clearer in six months or by end of this (financial) year.' Talks were initiated with the two companies when their officials visited India between November and January. HPCL had held two rounds of discussion with them so far.

Kuwait Petroleum has shown interest in investing in refining and petrochemicals projects in India and is reportedly in talks with Indian Oil Corp Ltd. to invest in the 15-mtpa Paradip refinery, which will be commissioned in the next few months.

The 15 mtpa refinery and integrated petrochemicals units are part of the government’s proposed Petroleum, Chemicals and Petrochemicals Investment Region in Vizag.

Land is also an issue and the Andhra government is yet to hand over the 3,000 acres required for the project. HPCL already runs a 8.3-mtpa refinery in Vizag. Shares of HPCL ended at Rs 424.40 on the NSE, down 1.6% from previous close.