News INC 24 | Barmer refinery project will be fully functional by 2024: Hardeep Puri

Feb 21,2023

Union Minister for Petroleum and Natural Gas Hardeep Singh Puri has said that Barmer refinery will be the “Jewel of the Desert” bringing jobs, opportunities and joy to the people of Rajasthan. Addressing the press at HPCL Rajasthan Refinery Limited (HRRL) complex on Tuesday,

Puri accused the Rajasthan government of dilly-dallying on bearing its share of cost escalation in the oil refinery project being set up in Barmer. The minister said that if the share of cost escalation is not borne by the state government, then its share may be reduced to 16 percent from 26 percent.

Puri said that the cost of the refinery cum petrochemical complex has increased from Rs 42,000 crore to Rs 72,000 crore due to the Covid-19 pandemic and the share of the state government in this cost escalation is around Rs 2,500 crore. He said that the state government was apprised of the cost escalation in August 2021 but the state government has not made its stand clear yet. Puri said that after the project is commissioned, the crude import bill of the country will reduce by Rs 26,000 crore. "This project is the best example of India's commitment to capital expenditure," he said.

He said that the country is going to be in the top three crude refiners in the world soon. India currently has a refining capacity of 250 million metric tonnes (MMT) per day and the target is to increase it to 330 MMT per day. The Barmer project is a joint venture of the Hindustan Petroleum Corporation Ltd (HPCL) and the Government of Rajasthan having a stake of 74 percent and 26 percent respectively. The project is scheduled to be commissioned by March 2024. Earlier, the deadline was December 2022. The project is also expected to give a boost to industrial development in the region.

During the construction phase the project will lead to growth of construction industry, mechanical fabrication shops, machining and assembly units, Supply of heavy equipment like cranes, trailers, JCB etc, transportation and hospitality industry, automotive spares and services and sand blasting and painting shop etc. HRRL will produce Butadiene, which is the raw material to manufacture Rubber, which is largely used in Tyre industry.

This will provide impetus to Automotive industry. Currently India is importing around 300 KTPA synthetic Rubber. With the availability of the key raw material, Butadiene, there is significant scope of reduction in import dependency in Synthetic Rubber. As India is poised in high growth trajectory in Automotive industry, Butadiene will play a catalytic role in this segment