M A I N   N E W S

A TRIBUNE EXCLUSIVE
Fresh threat to Bathinda refinery
T.R. Ramchandran
Tribune News Service

New Delhi, January 25
Punjab faces the threat of losing the grassroots Guru Gobind Singh Refineries Ltd (GGSRL) in Bathinda if the crucial Cabinet Committee on Disinvestment decides at its meeting here tomorrow evening to hive off the GGSRL from the disinvestment of the HPCL.

This will be a serious blow to Punjab after the land for the refinery was acquired on December 1, 1997, and the Defence Ministry issuing the no objection certificate for the project on January 12, 1998.

The refinery project is at the crossroads with Prime Minister Atal Behari Vajpayee having laid the foundation stone for the project and christening it as the GGSRL. The project would have benefited Punjab to the tune of Rs 800 crore annually and provided direct and indirect employment to 4000 persons.

The project was firmed up during the Akali regime headed by Mr Parkash Singh Badal and formed part of the commitment given to Punjab by the NDA government at the Centre.

The Punjab Government headed by Capt Amarinder Singh will have to get its act together expeditiously so that the Bathinda refinery is not delinked with the disinvestment of HPCL.

For inexplicable reasons the Punjab Government has been dragging its feet in signing the “deed of assurance” for nearly a year even though the Capt Amarinder Singh Cabinet had given its seal of approval. Letters from the HPCL to Capt Amarinder Singh and Chairman of the Committee on Fiscal Reforms and Financial Reconstruction and Resources Surinder Singh Singla failed to evoke the desired response.

The Ministry of Disinvestment and the Inter-Ministerial Group in its supplementary note has said the implementation of the Bathinda and Bina refineries projects should be left to the new management of the HPCL and the BPCL, respectively, in the post-disinvestment scenario.

This can be devastating as the company acquiring the HPCL might not be interested in making the huge investment of nearly Rs 10,000 crore in the GGSRL but bringing their own products and selling them.

Simultaneously, the Ministry of Disinvestment has suggested that no central PSU and Central Government cooperative with government ownership of 51 per cent or more including the Oil and Natural Gas Commission be permitted to bid for HPCL or BPCL. The ministry had also desired bringing down the equity control of the government to 15 per cent along with allowing the employees a share of 2 per cent.

Experts insist that in any privatisation of the HPCL, the buyer must give an undertaking of developing the GGSRL project in the next three to four years or face the consequences.

It is in this context that tomorrow’s meeting assumes significance when the CCD with Mr Vajpayee in the Chair decides the privatisation of the HPCL and the BPCL.

The GGSRL is a 9 MMT pa refinery at Pholakari at an estimated capital cost of about Rs 10,000 crore. This is as per June 1998 prices. It envisages a crude oil pipeline of 1011 km from Mundra in Gujarat to Phulokhari. It was originally proposed to be a joint venture with Aramco of Saudi Arabia which backed out subsequently. Later, the Punjab State Industrial Development Corporation (PSIDC) pitched in. The subsidiary route adopted by the HPCL was approved in October 2000. The Union Government’s permission for raising the equity capital was obtained in June 2001.

The GGSRL is slated to be a state-of-the-art refinery with 10 per cent LPG production and 55 per cent HSD along with a captive power plant.