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Saturday, March 19, 2011

Cals Refineries Latest News Update

New Delhi, March 18: Cals Refineries, which is setting up a refinery in Bengal, plans to induct Hardt Group affiliates as a strategic investor with management control to overcome its resource crunch.

Officials said Cals Refineries had entered into agreements to purchase two refineries — Cenco Refining Company (the US) and Atas Refinery (Turkey) — owned by the affiliates of Hardt Group on a refurbished basis for the second phase of Haldia project.

Atas is owned by international oil majors BP, Shell, & Turcas, while Cenco is majority owned by American multi-millionaire Pat Robertson’s trust. While Cenco is a 50,000-bpd (barrel per day) refinery, Atas’s capacity is around 100,000 bpd.

Analysts said, “Hardt has a track-record in financing and arranging international refinery relocation projects, which is Cals’ main strategy. The interesting aspect is that the sellers of these refineries — which are some associates of Hardt — have agreed to be equity partners in the project, in return for the refineries. We may have to wait for more clarity to take a view on the project.”

Cals plans to come out with global depository receipts for over 7 million, which will be purchased by the global investment firm. Cals will pay Hardt 7 million, with 7 million paid in the form of global depository receipts and the balance in cash.

Sources said it would soon apply to the government for regulatory approvals and later to the Foreign Investment Promotion Board for coming out with the GDR issue.

Hardt will ensure that the equipment get refurbished before they are delivered to the company and shipped to Haldia for the phase II of the project. The equipment will increase the aggregate refining capacity of Cals’ planned refinery project in Haldia to 200,000bpd.

In 2008, Cals had entered into an agreement to buy Bayernoil’s Ingolstadt refinery through Lohrmann International, which when dismantled, shipped, and re-erected in Haldia, would form the Phase-I of the project.

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