"Marketing is a key area for HPCL and investments will be made in setting up new depots, terminals and LPG bottling plants apart from increasing tankage," sources said.

The corporation will also use a part of the investment towards revamping retail outlets keeping in mind the opening up of the petroleum sector, which would mean that oil PSUs would be on their own.

HPCL's marketing infrastructure comprises 20 terminals, 86 depots, 31 bottling plants, 9 aviation stations, 4 lube plants and over 4,300 retail outlets. In addition, it has over 1,500 dealers for kerosene and diesel and around 1,450 dealers for LPG.

The corporation's priority in the Ninth Plan investment agenda also includes the Visakhrefinery, which will involve around Rs 2,500 crore, followed by the 5.5-million tonne Mumbai refinery for which Rs 1,400 crore has been set aside.

HPCL's present projections show that Rs 7,350 crore of the total Ninth Plan investment will be funded by internal accruals, while equity and debt will account for Rs 442 crore and Rs 3,663 crore.

Major expansion plans during the plan period include increasing capacity of the Vizakh refinery to 7.5 million tonnes from the present 4.5 million tonnes. Diesel hydrodesulphurisation has also been planned at the Mumbai and Visakh facilities. A 356-km pipeline connecting Visakh to Vijayawada will also be constructed during the period. The corporation will increase LPG import facility at Visakh to 0.6 million tonnes from 0.275 million tonnes and set up another with the same capacity at Mangalore for Mangalore Refinery and Petrochemicals (MRPL).

The joint venture investments include the 9-million-tonne Punjab refinery, which is being set up as a 26:26 joint venturewith Saudi Aramco. It will be one of HPCL's most important projects to be accompanied by a power plant and pipeline connecting Bhatinda to Udhampur. The capacity of the other joint venture refinery, MRPL, will be enhanced to nine million tonnes from three million tonnes.

A part of the Ninth Plan investment will be diverted to HPCL's new exploration joint venture company where the other partners are ICICI, TDICI and HDFC. This company will cater to off-shore and on-shore production and development, production and transportation of crude/gas.

The period will also see creation of LPG infrastructure, a marketing network and LNG projects being commissioned with Total of France. A 500-mw plant is proposed to be set up as a joint venture where a memorandum of understanding has been signed with the Andhra Pradesh State Electricity Board (APSEB).

West coast refinery may be put on back-burner
HPCL's six-million-tonne west coast refinery will not be commissioned during the ninth plan where priority willbe given to the nine-million-tonne Punjab facility.

The west coast project was planned with the Oman Oil Company but with the partner walking out and accounts yet to be reconciled between the two, the refinery will have to wait much beyond 2002. HPCL sources, however, reiterate that plans for the project are on as there have been many global players who are keen on picking up a stake in the project. The ministry of petroleum's sub-group report on the Ninth Plan puts HPCL's total refining capacity at 31 million tonnes (Mumbai- 5.5 million tonnes, MRPL- 9 million tonnes, Punjab- 9 million tonnes and Visakh- 7.5 million tonnes).