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Oil Refinery in Barmer – Realization of a Long Cherished Dream

By: Gopendra Nath Bhatt

The untiring efforts of the Rajasthan Chief Minister Ashok Gehlot have yielded results and the long cherished dream of the people of Rajasthan of having an Oil Refinery in Rajasthan is going to realize soon.

The crude oil being explored from the sand dunes of Rajasthan will change the picture of the State. The project of a refinery-cum-petrochemical complex in Barmer will be the second biggest and ambitious project in Rajasthan after the Indira Gandhi Canal which will rejuvenate the State.

It is the result of the State Chief Minister’s strong determination and efficient financial management that the long cherished dream of a refinery looks towards being realized and a golden chapter opens in the history of Rajasthan.

The proposed Refinery with an estimated capital investment of Rs. 37,230 crores will provide employment to about one lakh people directly or indirectly and huge investments will boost the economic growth of the State.

The refinery will play pivotal role in moving the State ahead on the path of prosperity. The royalty and additional revenue from the oil will help in increasing GDP growth of the State, besides enhancing the revenue reserves.

The refinery will bring an investment of Rs. 86 Thousand Crores in the next four years and will provide employment to 30-35 thousand people from the economically backward border area.

A Memorandum of Understanding (MoU) was signed between the Government of Rajasthan and Hindustan Petroleum Corporation Ltd. (HPCL) on 14th March for setting up a State-of-the-Art 9 MMTPA Refinery-cum-Petroleum Complex in Barmer.

The participation of the State Government will be 15 to 26 percent, while the participation of HPCL will be 51 to 74 percent in this ambitious project which will change the picture of Rajasthan.  The project of refinery-cum-petrochemical complex is expected to completed by December, 2017.

Chief Minister Ashok Gehlot for the first time had made a request to UPA Chairperson Sonia Gandhi during her Rajasthan visit to inaugurate the pipe line of HPCL for setting up the refinery in Barmer.

Gehlot had also requested the Prime Minister Dr. Manmohan Singh during his Barmer visit to launch the commercial production of crude oil in Barmer.  The issue had been raised during the Prime Minister’s meeting with the State Cabinet in Jaipur and the Prime Minister had given assurance to the Chief Minister.

The untiring and serious efforts of the Chief Minister for setting up a refinery in Rajasthan continued and he constantly made requests to the then Petroleum Minister Murli Deora and S. Jaipal Reddy.

He also raised this issue strongly during his meetings with the current Petroleum and Natural Gas Minister Dr. M. Veerappa Moily. Dr. Moily had assured Gehlot that the Centre will take a decision keeping in view the feelings and expectations of the people of Rajasthan.

The availability of Crude Oil in Rajasthan has been estimated to be 900 million tonnes.  Currently 9 million tonnes crude oil is being explored every year in Rajasthan, which is 20 percent of the total domestic production of crude oil in the country.  It is expected to reach 15 million tonnes per year in the near future.

Currently 1.75 lakh barrels of Crude Oil is being explored by Cairn India per day and Rajasthan has become the second biggest oil producing State after Maharashtra (2.25 lakh barrels).  If Rajasthan produces 3 lakh barrels crude oil per day it will be contributing 35 percent of total domestic Crude Oil production in the country and Rajasthan will become the number one Crude Oil producing State in the country.

After setting up refinery-cum-petrochemicals complex in Rajasthan the industries related to petro-chemicals, petro-engineering, petro medicinal research, polymers and plastic will get a boost in Rajasthan.

Naphtha, Diesel, Petrol, Kerosene and Aviation Fuel (Gasoline) will also be produced in the State.  After setting up other industries based on petroleum, the program will increase the employment opportunities for the youth of the State.

The process for land acquisition for the refinery in Leelala, Jaduon Ki Dhani and Sabramani areas near Baytu tehsil of Barmer district has started.

The State Government will provide 926 Hectares of land free-of-cost for the refinery and farmers affected by land acquisition will be provided full compensation for their acquired land.

The Industry Minister of Rajasthan, Rajendra Pareek says “the economy of the state will take a new turn for the better after setting up of refinery”.  According to experts this refinery will run on advanced technology and will be based on Vax Oil technique with an estimated Annual production of 90 Lakh Tonnes.

The Chief Minister has also announced for providing ITI training on a large scale to the local youth, which will help them in getting employment.  Besides Rajasthan, the states of Uttar Pradesh, Haryana, Punjab and Madhya Pradesh will be the prominent markets for the petro-products and by-products produced in Barmer.

The people of the State will get benefit of from low transportation cost for gas, petrol, diesel and other petro-products.

After the setting up of the refinery having a capacity of 9.14 million tonnes per year, the annual royalty from oil exploration which is Rs. 5000 crores currently, is expected to reach Rs. 13-15 thousand crores per year.

It will prove to be crucial for enhancing the financial condition of the State.

Chief Minister Ashok Gehlot has approved an Annual package of Rs. 3,376 crores (Viability Gap Funding) to HPCL after the commencement of commercial production.  Thus, financial incentive package of total Rs. 56,040 crores has been sanctioned for 15 years.

Apart from these facilities like free-of-cost land, water and development of basic infrastructure will be given by the State Government.

The refinery-cum-petrochemical complex being set up in Barmer is expected to be the foundation of a new Rajasthan.  The land of western Rajasthan which is facing drought and famine for years will ooze out Black Gold, which will change the picture of this State which is considered backward in many ways.

Courtesy: Rajasthan Suchna Kendra, New Delhi

Comments

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