Chennai Petroleum Corporation Ltd, (CPCL), belonging to Indian Oil Corporation Ltd, said on August 23 its board of directors has approved the proposal for the formation of a joint venture company for implementing the refinery and petrochemical complex.

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The nine million tonne per annum (MTPA) refinery project at Cauvery Basin Refinery, Nagapattinam district, Tamil Nadu, is being set up at an estimated investment of Rs 31,580 crore.

The investors include Chennai Petroleum Corporation, Indian Oil Corporation and other seed equity investors, namely Axis Bank, HDFC Life Insurance Company, ICICI Bank, ICICI Prudential Life Insurance Company and SBI Life Insurance Company.

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Further, the board of directors of the company has accorded approval for equity investment of up to Rs 2,570 crore in the joint venture, towards CPCL's contribution of 25 percent.

IOC and its subsidiary Chennai Petroleum Corporation will hold 25 percent each in the proposed 9 MTPA refinery, the remaining 50 percent will be held by a strategic or financial partner.

Back in 2020, a committee under the Ministry of Environment accorded a green signal for the project in the Cauvery Basin Refinery, which would provide direct employment to 600 people and 1,000 indirect jobs during the operational phase of the refinery.

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Shares of Chennai Petroleum Corporation Ltd ended at Rs 305.95, up by Rs 22.75, or 8.03 percent on the BSE.

(Edited by : Shoma Bhattacharjee)

First Published:Aug 23, 2022 6:23 PM IST