HPCL will invest approximately INR300bn for the new refinery, which is likely to be built in Raigad district of the Indian state of Maharashtra.
Arun Balakrishnan, chairman and managing director of HPCL, said: “We have been shown three pieces of land by Maharashtra government. We should be able to finalize the location in next few weeks.”
According to a senior company official, HPCL is facing space constraint at its 6.5 million tonnes-a-year Mumbai refinery. In five to ten years, the space constraint may make the unit inefficient.
Mr Balakrishnan added that the Mumbai refinery may eventually be shutdown once the new refinery is built. The new refinery is expected to be completed in 48 months from the date of receiving all approvals.
HPCL is also building a nine million tonne-a-year refinery at Bhatinda in the Indian state of Punjab, in joint venture with Mittal Energy. The project is expected to start operations by February or March 2011.
