"We had taken up the issue with the environment ministry for clearance and with the intervention of the prime minister, the project has got the approval of the ministry," minister of state for petroleum Santosh Kumar Gangwar told PTI in an interview.

Oman Oil Company and the state-owned Bharat Petroleum Corporation are jointly promoting the six-million-tonne refinery in Bina with 26 per cent stakes apiece.

The clearance for the project had been delayed due to objections relating to environmental impact of offloading crude at Vadinar in Gujarat, from where it would be moved to the project site through a 943km-long pipeline.

Fears of adverse effect of oil spillage owing to single-point mooring at the Vadinar port area on marine life were raised by local groups as the pipeline would havepassed through a marine park, sources said.

When asked about the reasons for delays, Gangwar said some "vested interests" did not want the project to progress.

Oman Oil Company, which has already spent Rs 70 crore towards the project, had threatened to withdraw, in case clearances were held up without valid reasons.

The project is expected to be commissioned by July, 2001, Gangwar said, adding Oman would invest about Rs 2000 crore in the refinery project.

The joint-venture company is also setting up a Rs 500-crore marketing terminal for which work has already started, sources said. Bharat Oman is targeting the north, besides Madhya Pradesh, where it is setting up marketing terminals, sources said.

The overall physical progress of the project till December, 1997, was a meagre 4 per cent, sources said, adding as against a cumulative financial commitment of Rs 181 crore the actual expenditure was Rs 51 crore.

Sources said the project had a foreign-exchange component of Rs 1,686 crore and thejoint-venture company a debt equity ratio of 1.5:1.

The government approval for the project was given in December, 1995, and the delay in environment clearance for the project was over a year.