State, HPCL ink fresh Rs. 43,129 cr refinery deal, Ex CM raised questions

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26 Apr, 17 13:22
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Jaipur: The Rajasthan government and the Hindustan Petroleum Corporation ltd (HPCL) Tuesday signed a fresh memorandum of understanding (MoU) for setting up a 9 million metric tonne (MMT) per annum capacity refinery-cum petrochemicalcomplex at Pachpadra in Barmer district of the state.
With this, the road has been cleared to resume work on the project, four years after it was first announced. The HPCL Rajasthan Refinery Limited, a joint venture between the HPCL and the state government, will build the refinery at an estimated cost of 43,129 crore.The state has already allotted 4800 acre land in Barmer for the project. Expected to be set up within four years of getting all the mandatory approvals, the refinery will be the first in India to meet Bharat Stage-VI (BS-VI) specifications. It will produce BS-VI emission norms compliant fuel petrol and diesel apart from petrochemical byproducts such as polypropylene and polyethylene.
Hailing the move, Union Minister for Petroleum and Natural Gas Dharmendra Pradhan said, "Rajasthan is touching new dimensions under Vasundhara Raje's leadership. The refinery is a big gift to eight crore people of Rajasthan, and to both the governments at Centre and in the state."
Hitting out at the opposition Congress, Pradhan said earlier the oil produced in state was processed elsewhere and Rajasthan only GOT the royalty. "Just to win elections, people's rights were neglected. Former CM Ashok Gehlot should answer, which is more - 3,736 crore or Rs 1,126 crore. It is Raje who negotiated the deal in state's interest," Pradhan said.
He was referring to the money the viability gap funding (VGF) of 1,123 crore that the state government would provide annually to the refinery for 15 years in form of interest free loan.
Under the new terms and conditions, the interest free loan (which state government has to pay) has come down to 16,845 crore, which was 56,040 crore in the previous MoU done by the Congress government in 2013, Pradhan said. "It was a direct loss of Rs 40,000 crore to the state of Rajasthan in 15 years. In the previous MoU, the state had to give Rs 3,736 crore interest free loan every year for 15 years, which would have burdened the state finances," Pradhan said.
He said government comes and goes but today's decision is important for state youth. The untoward incident was avoided and state will have 26% stake and refinery setup on BS-VI standards."The investment will get the state revenue, provide employment to youth, and bring value addition industries leading to overall economic development," Pradhan added.
He informed that for speedy implementation of the project, the Centre and the state government will create a single window and the project will be monitored every 15 days. State CM said"Rajasthan is the biggest producer of crude oil in India, making up for the 24 per cent of country's total produce. The refinery has come as an injection whose results will be visible in coming 5-10 years,"She too hit out at Congress. "Even 70 years after independence, people face problems related to electricity, water and roads. Had there been a BJP government at the Centre all these years, such a situation would have never cropped up," she said, adding "we want to connect people with development." She said the result of the bypoll to Dholpur assembly seat has shown that people want to connect with dreams of Prime Minster Narendra Modi and thus voted for development. Raje also sought Centre's intervention in helping state tackle the problem of saline water. "If the saline water is treated, we would be able to provide it to areas which do not have access to proper drinking and irrigation water," she said.The chief minister urged Pradhan to hold the ground breaking ceremony for the refinery in the month of SeptemberOctober.
HPCL chairman-cum-managing director Mukesh Kumar Sharma said HPCL added a new chapter in Rajasthan's history. "We assure that HPCL will complete the project soon," he added.
The MoU was signed by state mines and petroleum secretary Aparna Arora and Vinod S Shinoy, director refinery HPCL. All the state ministers, senior officials, MLAs, MP and other elected representatives were present.Gehlot hits out at 'half truths' on refinery; By delaying the Barmer refinery project by four years, the state has suffered revenue loss, job loss and business loss, which together combined is much more than 40,000 crore that the BJP government in Rajasthan claims to have saved by inking a fresh deal with HPCL, former chief minister Ashok Gehlot blamed BJP Govt after singing new MoU.

The Congress leader also accused Union Minister for Petroleum Dharmendra Pradhan of speaking half truths and asked him to get the two memorandums of understanding (MoUs) - one signed during Gehlot's tenure and the other by Vasundhara Raje government --- probed.
"The Union minister was here to announce the revised MoU, but he did not explain how ?40,000 crore was saved. He did not mention when the project will start making profits. The Union minister should have made the contents of the MoU public. What was stated Tuesday by Pradhan and CM Raje had no facts," Gehlot said during a press conference at his residence.
Rajasthan government and HPCL Tuesday inked a revised MoU of ?43,129 crore for setting up the refinery in Barmer district, which will produce BS-VIcompliant fuel. Under the new terms and conditions, the refinery cost has come down to ?16,845 crore, which was ?56,040 crore in the previous MoU done by the Congress government in 2013, Pradhan had said.
"The project was delayed by four years resulting in revenue loss for state and delay in employment generation. It also delayed setting up of ancillary units and related businesses. Gujarat earned ?1,500 crore in VAT every year due to this delay. This loss combined together is much more than ?40,000 crore that state claims to have saved," Gehlot said. He said the BJP government was "forced" to start the refinery project keeping in mind the state polls in 2018 and added "people will not forgive them for the crime".
He said Raje had questioned why state had only 26% equity share in the original MoU. Even the revised MoU has fixed state's equity at 26%, he said.
"The state share has not increased, rather refinery cost has escalated by ?6,000 crore. From the revised MoU it is unclear what the Internal Rate of Return (IRR) will be. When we inked the MoU, RRI was 15%. If the RRI is less in the revised MoU, then the state will earn less profit," he said.
He further said that "instead of misleading people by presenting partial facts, the union minister should direct the HPCL to get the both MoUs investigated to let the truth come out".
Gehlot said, the original MoU had put a condition that to avail ?3,736 crore interest free loan every year for 15 years, the joint venture company --- HPCL Rajasthan Refinery Limited --would have to maintain the commercial production of at least 9 million metric tonne (MMT) per annum. In case of less production, the quantum of loan was to be reduced proportionately, he added.
यह खबर निम्न श्रेणियों पर भी है: Rajasthan news
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