Following a rethink, has changed the focus of its ₹45,000-crore Cauvery Basin Refinery and Petrochemicals Ltd (CBRL) project in Nagapattinam; it is now envisaged as a petrochemical complex, rather than its earlier plans for a conventional refinery.
The project was originally conceived with CPCL and IOC holding 25 per cent share each, and the balance 50 per cent from investors. However, the project is currently structured as a joint venture with IOC holding 75 per cent and CPCL 25 per cent, CPCL Managing Director H Shankar said in an interaction with businessline.
CPCL, along with parent revisited the project configuration after the originally proposed refinery-cum-petrochemical complex faced challenges on the internal rate of return (IRR), he told businessline.
Shankar said technical and feasibility studies are underway and discussions are being held with engineering consultant Engineers India Ltd (EIL) as well as the Tamil Nadu government regarding incentives and project facilitation.
The company expects preliminary clarity on the revised configuration in about a year.
The original project was envisaged as a 9-million tonne refinery integrated with a polypropylene unit. However, the economics of a fuel-heavy configuration became less attractive over time, prompting the partners to reassess the investment structure and product mix, he added.
According to Shankar, the revised proposal could involve cracker-based petrochemical facilities aimed at catering to India’s growing petrochemical demand rather than competing in the fuel market.
Despite delays, CPCL said groundwork for the project has advanced considerably. The company has invested nearly ₹1,000 crore primarily towards land acquisition and related development activities. The entire land parcel has now been secured with patta transfers completed and boundary wall construction under way.
“This project can create an entirely new industrial ecosystem in the Cauvery delta region, with downstream chemical and petrochemical industries coming up around it,” Shankar said.
He added that the coastal location, road and rail connectivity and proximity to port infrastructure make Nagapattinam an ideal site for a large petrochemical complex.