The Andhra Pradesh government and Hyderabad-based Amerind Petroleum Private Limited on Wednesday signed a memorandum of understanding to set up a petroleum refinery near Visakhapatnam with an estimated cost of Rs 11,196 crore.
In the first phase, the company will relocate an existing oil refinery, with a production capacity of 1.5 lakh barrels per day, it bought from Sunoco, New Jersey. “The cost of the first phase will be Rs 2,525 crore,” Dr J. Geeta Reddy, major industries minister, said.
The minister said that the project, which is expected to generate revenue of Rs 15,544 crore for the Centre and state governments every year in the form of various taxes and duties, will be accorded a mega-project status and given special incentives as per the industrial policy.
While the American Industrial Corporation, an industrial project management company, is providing technical assistance, the Exim Bank of USA, issued the ‘letter of approval’ to provide 80 per cent financial assistance, for relocating the oil refinery.
Amerind is promoted by city entrepreneur Syed Badruddin who, according to an official press release, hails from a well-known aristocratic family in the city and is a successful technocrat entrepreneur with industrial experience of 36 years.
Mr Badruddin said he was the chief promoter and MD of Anjani Portland Cement, in which he still hold seven per cent stake. “The US authorities are fully backing the project because of my 25-year association with them in my capacity as the chairman of Indo American Chamber of Commerce,” he said.
“We proceeded with the MoU only after confirming with the Exim Bank about its willingness to fund the project,” a senior industries official pointed out. On the request of the promoters to provide 700 acres in the Petroleum, Chemical and Petro Chemical Investment Region, the official said the company would be asked to acquire land on its own with assistance from the government.
The MoU was signed in the presence of CM N. Kiran Kumar Reddy, Dr Geeta Reddy and a delegation of US Consulate officials including the chief of consular services Michael Yoder.