In return, Saudi Aramco will partner HPCL in expanding the capacity of its 7.5 mtpa refinery in Vizag. Both the refineries will focus mainly on exports of petroleum products to various countries.
Speaking to reporters from Riyadh, petroleum minister Mani Shankar Aiyar said that an in-principle agreement between the two governments has been reached on this arrangement. However, the commercial details will be worked out by the respective oil companies.
HPCL chairman and managing director MB Lal and petroleum ministry joint secretary Prabh Das will be in Saudi Arabia for a few more days to work out the commercial and financial details of jointly executing refinery projects in India and Saudi Arabia.
Saudi Aramcos participation in the 12 mtpa Paradip refinery project of Indian Oil Corporation (IOC) in Orissa is also being pursued, sources said.
The project at Yambu is a integrated refinery cum petrochemicals project with an installed production capacity of 1,00,000 tonne of regular paraffin and 8,00,000 tonne of alkyl benzene annually. India is the fourth biggest petroleum consuming country in Asia and it currently imports 60% of its crude oil requirements (about 4,30,000 barrels per day) from Saudi Arbia. Discussions were also held between the two sides on investment by Saudi Aramco in setting up commercial crude oil storages in India.