This story is from December 6, 2016

For glory, government gives late push to refinery project

To highlight refinery project in its three years celebrations list, state government has fasten the efforts to break the political quagmire and make some headway.
For glory, government gives late push to refinery project
Vasundhara Raje
JAIPUR: To highlight refinery project in its three years celebrations list, state government has fasten the efforts to break the political quagmire and make some headway. CM Vasundhara Raje along with senior officials is expected to meet union minister for petroleum Dharmendra Pradhan on Tuesday while stakeholders, Hindustan Petroleum Corporation (HPCL) and Rajasthan government held discussions last week to reach on consensus.

After rebuking previous Congress government in first three years of its tenure for surrendering before HPCL, Rajasthan government is now looking to move ahead with the project. To give much needed pace, company’s CMD, MK Surana and director refinery VS Shenoy met deputy chairman of chief minister advisory council, CS Rajan Rajan.
Sources claim that both state government and HCPL have agreed to bring flexibility in their approach so that project can kick off soon. “Discussions revolved around new pricing, capital cost, crude availability in oil fields. Both stakeholders have a positive outlook and we can expect something positive soon” said the official who is privy to the developments in the project.
“It’s been three years now and government would like to showcase the Rs 37000 cr refinery as part of its achievements” added the official. When Aparna Arora, secretary petroleum contacted, she refused to reveal details on the current development. “I can’t talk about it” said Arora.
In the last meeting Rajasthan government asked HPCL to rework on its targeted 15% of internal rate of return (IRR). State is insisting that IRR should be between 12-13% as in the case with other refiners in India. Sources claim that company is resilient but to revise the IRR company will have to take the matter to its board and seek approval.
Similarly, to make the project a reality, Rajasthan government is also likely to soften its stand of not providing financial assistance of Rs 3,376 crore annually as part of viability gap funding (VGF). The contention is over the financial assistance of Rs 3,376 cr annually to HPCL for 15 years from the year of refinery operation.
Chief Minister Vasundhara Raje was not endorsing the agreement between the Gehlot government and HPCL and stressed on renegotiating the terms for setting up the refinery. Major among them was the financial help in form of VGF.
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