ONGC-Cairn thrash out issues, pipeline in 12-18 months

New Delhi, Jan 15 (UNI) Oil and Natural Gas Corporation, (ONGC) today said differences have been resolved with Cairn India Ltd for setting up a 340-million dollar pipeline to transfer crude oil from Barmer district of Rajasthan to Gujarat.

The project will be completed in 12-18 months with a pipeline investment ratio between Cairn and ONGC at 70:30.

ONGC Chairman and Managing Director R S Sharma said ''we have reached an understanding for setting up a pipeline to take Rajasthan crude to Gujarat.'' Cairn-ONGC will build a 340-km line to IOC's Viramgam terminal in Gujarat. Viramgam is connected by pipelines to IOC's Koyali, Panipat and Mathura refineries, the potential customers of Rajasthan crude. A smaller pipeline can then be built to the west coast, or Jamnagar where Reliance Industries and Essar Oil have refineries.

The ONGC Chief said the option of building a refinery in Rajasthan is open. The investments would be made only if the state government gave fiscal incentives, he added.

''Irrespective of the fact that the refinery is built or not, we have to build a pipeline to evacuate the crude in the interim period. We can sell the crude to IOC, MRPL or private sector refiners,'' Mr Sharma said.

The dispute revolved around MRPL, which was official offtaker of the Rajasthan crude would be solely responsible for laying the pipeline.

''Now, we have an understanding that the pipeline will be jointly built,'' he said.

UNI