The Union Cabinet has approved the Numaligarh Refinery expansion with an investment of Rs 22,000 crore from 3 MMTPA (Million Metric Tonne Per Annum) to 9 MMTPA.
The expansion project involves setting up of crude oil pipeline from Paradip to Numaligarh and product pipeline from Numaligarh to Siliguri at a cost of Rs.22,594 crore. The project is to be completed within a period of 48 months, after approval and receipt of statutory clearances.
The total project cost will be financed by a mix of debt, equity and Viability Gap Funding (VGF). The debt of Rs.15,102 crore will be raised by Numaligarh Refinery Ltd (NRL) and apart from its internal accrual of Rs.2,307 crore, the promoters, namely, Bharat Petroleum Corporation Ltd, Oil India Ltd & Government of Assam (GoA) will contribute to equity. The project will be supported by Viability Gap Funding of Rs.1,020 crore from the Government of India.
The Narendra Modi-led government signed off on the expansion plan ahead with its aim to woo voters in the North-East with mega projects in the run-up to the general elections.
The expansion of the refinery will meet the deficit of petroleum products in the North East. It will also sustain the operations of all North East refineries by augmenting their crude availability. It will generate direct and indirect employment in Assam and is a part of the Government’s Hydrocarbon Vision 2030 for the North East.
NRL Managing Director SK Barua said, “This mega project would usher Assam and the NE region in a new era of economic and industrial development by boosting large scale investment opportunities and creating robust direct and indirect employment opportunities. An estimated 8,000 people would be involved in executing the project during its construction.”
He added that the project would also contribute significantly in meeting the growing demand of petroleum products in Northeast and Eastern India and ensure crude oil security for all the four Assam Refineries.
“It would additionally act as a fulcrum and prime mover for other projects envisaged in the NE Hydrocarbon Vision 2030. Auguring well with Act East policy of Govt. of India, it will enhance export of petroleum products to India’s geographically contiguous neighbours viz. Myanmar, Bhutan and Bangladesh,” Baruah added.