GAIL-promoted BCPL, which is setting up a petrochemical project 'Assam Gas Cracker Project', has sought subsidy of more than Rs 12,000 crore on account of feedstock and revenue for a period of more than 10 years after it starts operating.
GAIL is the main promoter having 70 per cent of equity participation in the Brahmaputra Cracker and Polymer Ltd (BCPL) and the rest 30 per cent is equally shared by Oil India Ltd (OIL), Numaligarh Refinery Ltd (NRL) and Government of Assam.
The Assam Gas Cracker Project will be the first ever project in the entire North-East at Lepetkata near Dibrugarh in Assam.
The feedstock for the project will be natural gas and naphtha. OIL and ONGC will supply gas and naphtha shall be supplied by NRL.
"BCPL have sought feedstock subsidy of Rs 8,965 cror over first 12˝ years and Rs 3,668 crore revenue subsidy over 10˝ years," a source said.
Sources, however, added the Department of Petrochemicals has asked BCPL to rework on its proposal for subsidy on feedstock as gas price considered for calculating the subsidy is more than the prevailing market price.
Amid delays in completion of the project, the board of BCPL has also approved to submit a proposal for enhancement of the capital cost to Rs 9,586.25 crore and this will be second time the cost of project will be enhanced.
In November 2011, the CCEA has revised the cost of project to Rs 8,920 crore from the original estimated cost of Rs 5,460.61 crore when the project was approved by government in April 2006.
The Assam Gas Cracker Project was initiated in pursuance of the Memorandum of Settlement signed between Central Government, All Assam Students Union (AASU) and All Assam Gana Parishad (AAGP) on 15th August 1985.
This project is of great economic significance for the Assam and the North East region.
Meanwhile, in order to promote investments and expedite the implementation of Petroleum, Chemicals and Petrochemical Investment Regions (PCPIRs), the government has decided to constitute a steering committee for each of the PCPIRs under the chairmanship of Secretary, Department of Chemicals and Petrochemicals.
At present, PCPIRs are being set up in the four coastal states of Gujarat, Andhra Pradesh, Odisha and Tamil Nadu.