Engineering News

Former Sunoco Refinery to Be Reassembled in India
November 28, 2011

A 62-year-old petroleum refinery near New Jersey in the US, which was shut down in 2009 because of high levels of pollution, is all set to reopen as new in Visakhapatnam.

The Andhra Pradesh government on November 17 signed a MoU with an Indian company - Amerind Petroleum Pvt Ltd promoted by not- so- familiar industrialist Syed Badruddin - to reassemble the refinery at a cost of ` 11,196 crore.

It will be an integral part of the proposed petroleum, chemicals and petro- chemical investment region ( PCPIR) between Visakhapatnam and Kakinada.

But according to environmentalist EAS Sarma, the proposal is " dubious" and the refinery " environmentally unacceptable". According to the MoU, Amerind, in the first phase, would set up the refinery on a turn- key basis in collaboration with American Industrial Corporation, its technical collaborator in the US, by relocating an existing refinery at a cost of about ` 2,525 crore, and with an initial refining capacity to process 7.50 million tonnes of crude oil per annum. It will produce the entire range of petroleum products.

In the second phase, the refinery will be expanded to have a total refining capacity of 15 million tonnes per annum, along with a petro- chemical complex at an additional estimated cost of ` 8,611 crore. Badruddin told the media at the time of signing of the MoU that the Export- Import Bank of the US would lend $ 375 million of the project's initial cost of $ 500 million.

Andhra Pradesh chief minister N. Kiran Kumar Reddy announced that the Amerind refinery project would get a special incentive package under the state's industrial policy.

Interestingly, nothing much was mentioned in the MoU about the status and condition of the US refinery, which would be relocated to Visakhapatnam.

Inquiries by former Union energy secretary Sarma revealed that the refinery - named Eagle Point Refinery - started operations at Westville, Gloucester County, in 1949 under the aegis of Texaco.

In May 1985, it was taken over by Coastal Oil and in January 2004, it went into the hands of Sunoco Inc (R& M).

However, it was shut down in 2009 because of high levels of pollution and high running costs.

Sarma referred to a media report in the US, which quoted Sunoco's spokesman Thomas P. Golembeski as saying that the company had nothing to announce about the relocation of the refinery to India but confirmed that Sunoco had been trying to sell Eagle Point's equipment since the refinery closed.

In his letter to Union petroleum secretary G. C. Chaturvedi, Sarma quoted the report of the US environment protection agency that had inspected the refinery before its closure.

"The refinery for which the Andhra Pradesh government has signed the MoU with Amerind with such fanfare is 62 years old. Apparently, its technology is somewhat outdated, its pollution threats fairly significant and its costs so high that it had to close down," Sarma pointed out.

Secretary ( industries) T. S. Appa Rao, who was instrumental in signing the MoU with Amerind, was not available for comment. Nothing much is known about Amerind as well.

Its website is totally blank and just gives its name, without details on the promoters.

At the time of signing the MoU, Badruddin had described himself as a successful technocrat entrepreneur with 36 years of experience in manufacturing industries in Andhra Pradesh.

Source: Mail Today

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