Mittal may tie up with HPCL for Africa plans

New Delhi, Dec 28 | Updated: Dec 29 2007, 04:57am hrs
Steel tycoon Lakshmi N Mittal plans to set up multi-billion dollar refineries in Congo and Nigeria and has approached state-run Hindustan Petroleum Corporation Ltd for a partnership.

Mittal Investments Sarl, the holding company of Mittal family, which earlier this year picked up 49 %stake in HPCL s 5-billion dollar Bhatinda refinery in Punjab and signed agreement to explore setting up an export-oriented refinery at Vizag on east coast, has sought partnership with HPCL for expansion of a refinery in Congo and setting up a 10 million ton refinery in Nigeria, industry sources said.

SNPC, the national oil company of Congo, has offered Mittal Investment Sarl a stake in an offshore oil block along with a proposal for expansion of its one million ton capacity refinery in Point Noire which is also a major oil terminal.

The 1,044 sq km oil block Marine IX has Premier Oil of UK as the operator with 58.5 %stake. Ophir Energy holds 31.5 %stake while SNPC has the remaining 10 per cent. Premier Oil and Ophir are seeking a co-investor to join in the funding of a two-well drilling programme. Sources said Nigerian National Petroleum Corp (NNPC) has invited Mittal for exploring feasibility of setting up a 10 million ton refinery. NNPC is to hold 40-49 %stake in the proposed refinery that will cater to domestic fuel demand and export surplus. HPCL-Mittal, who may be given 51 %in the project, are interested in working with NNPC to examine the feasibility of setting up the new refinery.

Interestingly, Mittal had earlier this year lost a bid to takeover Nigeria s biggest oil refinery at Port Harcourt. Mittal had originally planned to bid for the 10.5 million ton Port Harcourt refinery with HPCL but in the end went alone as the state-run firm s due diligence of the project did not find it feasible.