While IOC and Marubeni would have a 26 per cent stake each in the 301 mw power project at Panipat, the balance 48 per cent would be shared by various financial institutions and other associates. The power project will have a debt to equity ratio of 2.33:1 in which the equity will amount to Rs 500 crore.

Marubeni, the joint venture partner for the project will get the technical expertise in putting up this project at Panipat. The power plant will make use of vacuum residue fuel (VRF) as the feedstock coming from IOC's six million metric tonnes per annum (mmtpa) Panipat refinery of the IOC.

According to the official spokesperson, the implementation of the project, near IOC's Panipat refinery, will help increase the profitability of IOC and mitigate theproblem of power shortage in Haryana.

It may be mentioned here that IOC has also submitted a proposal to expand the capacity of the refinery from the present six mmtpa to nine mmtpa at an estimated cost of Rs 1605 crore. The public investment board (PIB) is reported to have given the first stage clearance for the expansion of the refinery in December 1998.

The Rs 3868 crore six million tonne refinery of IOC has already processed 1.2 milion tonnes of crude oil since its trial run in may last year besides LPG, naphtha, kerosene, high speed diesel and heavy petroleum stock and furnace oil.

It may be mentioned here that apart from the power plant, the corporation is also planning to set up a petrochemical project at an estimated cost of Rs 4056 crore.

The company is also scouting for joint venture partners for this petrochemical project and is awaiting the second stage clearance from the government. Paraxylene and purified tetraphthalic acid (PTA) will be produced in the complex which will also be usingfeedstock provided by the refinery.

The expansion of the refinery is expected to be completed within 36 months of the project getting government clearance. Malaysian national oil company Petronas is likely to pick up 26 per cent stake in the petrochemical project and the two companies are only awaiting CCEA clearance for a formal joint venture pact.

Apart from Petronas, Oil and Natural Gas Corporation (ONGC) has indicated interest in picking up equity in the venture. IOC plans to put up capacities for paraxylene and pta of 3,50,000 tonnes and 5,25,000 tonnes respectively using special cut naphtha supplied by Panipat and Mathura refineries.

The project is expected to be completed in around three and half years after second stage clearance.