Independent oil and commodities trader ans Trafigura Pte. Ltd. announced the investment of up to Rs.1,250 crore or $250 million in the Nagarjuna refinery coming up at Cuddalore in Tamil Nadu and in storage facilities.
In a statement released in Singapore, Trafigura said it would invest Rs.650 crore ($130 million) to acquire 24 percent stake in the Nagarjuna Oil Corporation Ltd. refinery (NOCL). Besides, it would pump in Rs.600 crore ($120 million) to construct storage facilities and associated infrastructure at the refinery.
Trafigura's investment in the NOCL refinery was the first of its kind for the company, enabling it to create operational efficiencies and to add value to its customers' supply chains.
"Geographically, the facility is well positioned to receive crude oil from Trafigura's international producer partners. The investment also affords the company the ability to participate in India's domestic market where rising incomes, higher vehicle sales and rapid urbanization are driving the country's position as one of the world's fastest-growing major economies," it said.
The refinery will have a capacity of six million tonnes per annum, and can process 100 percent heavy/sour grades of crude oil and will supply light and middle distillates up to European IV standards.
The Hyderabad-based Nagarjuna group holds a 51 percent stake in the project, with Tata Petrodyne, a Tata group company, being the other major shareholder with a 30 percent stake. The Tamil Nadu Industrial Development Corporation, a Tamil Nadu Government industrial promotion undertaking, is the project's co-promoter.
Commissioning work at the refinery is expected to start this year with commercial operations scheduled to begin during the first half of 2013.
The Nagarjuna refinery, being set up at an investment of Rs.10,000 crore, will be the anchor unit for the Centre's Petroleum, Chemicals and Petrochemicals Investment Region in the area. This will bring in investment of up to Rs.13,000 crore in associated facilities and infrastructure.
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