India's Guru Gobind Singh Refinery in Punjab to be Commissioned in 2011

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Researched by Industrial Info Resources (Sugar Land, Texas)--India's HPCL-Mittal Energy Limited (HMEL) (Noida, Uttar Pradesh), a joint venture company formed by integrated oil refining and marketing major Hindustan Petroleum Corporation Limited (BSE:500104) (HPCL) (Mumbai) and Mittal Energy Investment Pte Limited (Singapore), which is a Lakshmi N. Mittal Group Company, said that its grassroot Guru Gobind Singh Refinery (GGSR) project at Bhatinda in Punjab is expected to be ready by 2011. The 190,000-barrel-per-day (BBL/d) refinery's products will comply with Euro IV emission norms. The project includes a 165-megawatt (MW) captive power plant (CPP) and a 1,014-kilometer crude oil pipeline from the company's new offshore crude oil terminal (COT) at Mundra in Gujarat to the project site. The two joint venture partners hold equal stakes of 49% each, while the remaining 2% stake is owned by financial institutions.

After several revisions of the project completion date, the mechanical works at the GSSR project are expected to be completed by May 2011 and commissioning activities are expected to be completed by August 2011. The current partnership was formed in 2007. The refinery products are expected to meet the petroleum product demands of the states of Punjab, Delhi, Haryana, Uttar Pradesh and eastern Bihar. A $128 million, 300-kilometer product pipeline with a transportation capacity of 107,000-BBL/d will be constructed from the refinery site to Haryana's Bahadurgarh.

The GGSR project, which is worth more than $4 billion, has been on the drawing board since 1999, but the project never took off for various reasons, among them several changes in HPCL's project partner. The project has been envisioned and designed to be a high-distillate yielding, zero-residue refinery that will produce clean fuels and polypropylene. The energy-efficient and environmentally friendly project will process acidic, heavy and sour crudes.

The $854 million, 18 million- to 20 million-ton-per-year crude oil pipeline will pass through the states of Gujarat, Rajasthan and Haryana. The single-point mooring (SPM) buoy at Mundra will be capable of handling imported crude arriving in very large crude carriers. The pipeline project is being managed by HPCL-Mittal Pipelines Limited (HMPL) (Noida), a wholly owned subsidiary of HMEL. Mechanical completion of the SPM, COT and pipeline are all scheduled for this year.

The $76 million contract for laying the first 550 kilometers of the Mundra-Bhatinda pipeline was awarded in 2009 to Kalpataru Power Transmission Limited (BSE:522287) (Mumbai). The scope of work extends from Kota near Mundra to Jhanwar in Rajasthan.

According to company reports, the project is progressing at a rapid pace, with almost 90% of the work completed. Construction is under way; detailed engineering, tendering and ordering are almost complete; and basic engineering work is complete. There are 48 contractors involved with the project at present. Engineering consultants Engineers India Limited (BSE:532178) (EIL) (New Delhi) have been retained to manage the engineering, procurement and construction work of the project.

In January 2009, HMEL awarded close to $300 million worth of contracts to engineering company JSC OGCC KazStroyServise (Almaty, Kazakhstan), which is the parent company of Petron Civil Engineering Pvt Limited and Petron Engineering Construction Limited. The contracts involved the construction of the sulfur unit, heaters, and structural work for several refinery units and certain refinery buildings.

Infrastructure has been completed at the refinery site. Almost all the crude/vacuum distillation unit equipment has been erected, while electrical, instrumentation and piping work is in progress. The fluid catalytic cracking unit and the delayed coker unit also have been erected. Construction of the hydrogen generation unit and the sulfur blocks are in progress.

In 2008, power equipment manufacturer Bharat Heavy Electricals Limited (BSE:500103) (BHEL) (New Delhi) was awarded the contract to set up the gas turbine-based combined cycle CPP. Development of the CPP is also in an advanced stage, with the gas turbines, turbo generators, and heat-recovery steam generator already delivered. The steam turbines are being manufactured.

In January 2009, fuel handling and tanks construction company Artson Engineering Limited (BSE:522134) (Mumbai) was awarded a $41 million contract to construct 64 product and intermediate storage tanks at the GGSR facility. Before that, in July 2008, the company was awarded a $7.7 million contract to construct four crude oil storage tanks.

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