Saudi Aramco, the world's largest oil producer, will hold an equal stake in the planned $44-billion refinery-cum-petrochemical project in Maharashtra, Rama Gopal, director of refineries at Indian Oil Corp. said.
Indian Oil, Hindustan Petroleum Corp. and Bharat Petroleum Corp. plan to jointly set up one of the largest petrochemical projects in the world on the West coast of India, to cater to the country's growing fuels and petrochemical requirements.
India has a refining capacity of 232.1 million tonnes, which exceeded the demand of 194.2 million tonnes in the financial year 2016-17. According to the International Energy Agency, this demand is expected to reach 458 million tonnes by 2040.
Aramco is looking to lock in customers in the world's third-largest oil consumer through the investment. Saudi Arabia was the biggest oil supplier to India till 2016-17 but slipped behind Iraq last year. It had supplied 39.5 million tonnes of crude oil to India in 2016-17, ahead of 37.5 million tonnes by Iraq.
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The proposed refinery will give the Saudi national oil company an assured customer for additional 30 million tonnes of its crude oil. It will supply half of the crude oil required for processing at the refinery, Saudi Oil Minister Khalid Al-Falih told reporters earlier in the week.
Currently, IOC holds 50 percent stake in RRPL, while HPCL and BPCL have 25 percent stake each. After Aramco's entry, the 50 percent stake will be split in same proportion between IOC, HPCL and BPCL, Gopal said.
The refinery-cum-petrochemical complex will cost around Rs 3 lakh crore and will be completed in the next five to seven years.
(With inputs from PTI)