Rs 60,000-Crore Oil Refinery Proposal For Andhra Pradesh Expected In Budget After Modi-Naidu Meeting: Report

Budget 2024: The formal announcement of the refinery is expected during the Budget presentation scheduled for July 23

Budget 2024: In a recent meeting between Andhra Pradesh Chief Minister N Chandrababu Naidu and Prime Minister Narendra Modi, the central government has reportedly agreed to a major demand for setting up an oil refinery and petrochemical hub in the state. According to a report by The Economic Times, the project is expected to attract an investment of Rs 60,000 crore.

Chief Minister Naidu, whose Telugu Desam Party (TDP) is a crucial ally of the National Democratic Alliance (NDA), held discussions with top officials from Bharat Petroleum Corporation Limited (BPCL) on Wednesday to explore the feasibility of establishing the refinery in the state. Sources familiar with the matter informed ET that three potential locations were considered: Srikakulam, Machilipatnam, and Ramayapatnam.

The formal announcement of the refinery is expected during the Budget presentation scheduled for July 23. However, the process of selecting the location may extend beyond the Budget, the report noted.

"This announcement holds political sensitivity as each location represents a different geographical segment of the state — north, central, and south," a source requesting anonymity told ET. ABP Live could not independently verify the report.

The commitment to setting up the refinery traces back to the Andhra Pradesh Reorganisation Act, 2014, which mandates comprehensive measures for the sustainable development of successor states within a stipulated timeframe. Section 93 of the Act specifically outlines provisions under the Thirteenth Schedule, stressing the establishment of a greenfield crude oil refinery and petrochemical complex in Andhra Pradesh by entities such as IOC or HPCL.

While BPCL and the Ministry of Petroleum have refrained from official comments on the matter, Chief Minister Naidu took to social media platform X to affirm the state's strategic advantage on the eastern coast for such industrial ventures.

"Today, I met with Bharat Petroleum officials to discuss plans for an oil refinery and petrochemical complex in Andhra Pradesh, expecting investments of Rs 60,000-70,000 crore," he announced, urging for a comprehensive feasibility report within 90 days and highlighting the need for approximately 5,000 acres of land, which the state government is committed to facilitating smoothly.