13 March 2009 17:09 [Source: ICIS news]
NEWS DELHI (ICIS news)--The cost of Oil and Natural Gas Corporation's (ONGC's) joint venture Dahej petrochemical complex (DPC) has risen by more than a quarter due to delay and depreciation in the rupee against the dollar, an Indian government source said on Friday.
ONGC revised the cost up by 27.57% to Indian Rupees(Rs) 158.7bn ($3.01bn) from 124.4bn, the source close to the project said. It is implementing DPC through a joint venture named ONGC Petro-additions Limited (OPaL).
The cost escalation of DPC would have been much more had the company not dropped two of its downstream units and re-configured others, the official said.
ONGC has proposed to meet this additional expenditure by increasing the debt component of the project cost and by selling its shares to strategic investors at a premium.
The company's board was expected to consider next month GAIL (?xml:namespace>
ONGC has a controlling stake of 26% in OPaL. Gujarat State Petroleum Corporation (GSPC) has 5% equity stake in JV. The balance 69% shares are to be offered to strategic investors and the public.
The dual-fed cracker will have an ethylene capacity of 1.1m tonnes/year. Its downstream plants would produce linear low density polyethylene (LLDPE), high density polyethylene (HDPE) and polypropylene (PP). It was due to be commissioned in October 2012.($1 = Rs51.69)
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