Having lost £17 billion in the global financial meltdown, India-born billionaire Lakshmi Mittal has put on hold his investments in $10 billion refinery-cum-petrochemical project planned at Vizag.
Mittal is, however, going ahead with investing in Hindustan Petroleum Corp’s (HPCL) Rs 18,919-crore, 9-million-tonne-a-year Bhatinda refinery
in Punjab.
"They (Mittals) have informed us that they would like to go slow or rather put a pause on their investment in the proposed project in Andhra Pradesh," Arun Balakrishnan, chairman of HPCL, one of the five promoter firms of the projects, said.
Mittal Investment Sarl, the holding company of Mittal family, has told HPCL and other promoters to go ahead with the project but "keep us in mind for a possible future re-entry."
The five-way alliance of HPCL, Mittal, French energy giant Total, gas utility Gail and Oil India (OIL) was currently doing pre-feasibility study for the project and the partners are scheduled to take an investment decision in March 2009.
"Total is very keen on the project and we are going ahead with the project," he said.
Other than Mittal, the partners feel this was the right time to build the project, when globally steel and other input costs have come down and fabrication yards are looking at new orders to keep themselves afloat and orders from major economies were being cancelled on fears of a recession.
"We will take a re-look at the project in March, and in the meanwhile, we are going ahead with the technical studies," Balakrishnan said.
While the export-oriented refinery will be of the order of 14-15 million tons a year, the petrochemical plant would be of at least one million tons capacity.
Balakrishnan said studies underway are looking at demand, particularly that of petrochemicals in light of the fact that automobile and realty sectors, which are major users of plastics that the petrochem unit was to produce, are facing a downturn with sales halving.
These studies would be the basis for investment decisions, he said.

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