The restart was possible after one of the principal lenders, SBI, sanctioned Rs 350 cr as working capital loan into the ailing petrochemical plant
More than six months after it abruptly discontinued operations, Haldia Petrochemicals Limited (HPL), the showpiece industrial project of West Bengal, restarted commercial production on Wednesday.
The restart was possible after one of the principal lenders, State Bank of India, sanctioned Rs 350 crore as working capital loan for the ailing petrochemical plant.
"For the last three days, trial runs were on. Bagging of materials has started, and trucks rolled out," a senior government official said.
The plant was shut down on July 7 due to shortage of working capital though the official reason given was technical problem in the naphtha cracker unit. The consortium headed by IDBI includes SBI, PNB and ICICI Bank.
The lenders' consortium decided to infuse capital after co-promoter Purnendu Chatterjee, chairman of The Chatterjee Group (TCG), agreed to bring in the margin amount of Rs 100 crore.
While the management of HPL had earlier asked for a fund of Rs 1,000 crore, the lenders had agreed to infuse cash in small tranches. "Ultimately it would go up to Rs 1,000 crore. The prospect of the plant was helped by the fact that the price of naphtha, main raw material for a petrochemical plant, fell sharply in the world market," said the government official.
"While earlier it was impossible to run the plant at an optimum capacity without a capital of Rs 1,000 crore, now we have told the lenders that even Rs 600 crore would be enough to restart the plant," the HPL official explained.
Having resolved the crisis at HPL, it was likely that the state government and TCG would now sit across and discuss the share purchase agreement. The state government has decided to hand over its shares to TCG, but the transaction is pending.
The reopening of HPL will finally bring relief to the downstream units who were staring at a bleak future after the closure. "The plant has already started despatching products, we also had a talk with the HPL management who assured us that the plant would function at optimum level," said Ramesh Rateria, vice-president of Indian Plastics federation (IPF).
More than six months after it abruptly discontinued operations, Haldia Petrochemicals Limited (HPL), the showpiece industrial project of West Bengal, restarted commercial production on Wednesday.
The restart was possible after one of the principal lenders, State Bank of India, sanctioned Rs 350 crore as working capital loan for the ailing petrochemical plant.
"For the last three days, trial runs were on. Bagging of materials has started, and trucks rolled out," a senior government official said.
The plant was shut down on July 7 due to shortage of working capital though the official reason given was technical problem in the naphtha cracker unit. The consortium headed by IDBI includes SBI, PNB and ICICI Bank.
The lenders' consortium decided to infuse capital after co-promoter Purnendu Chatterjee, chairman of The Chatterjee Group (TCG), agreed to bring in the margin amount of Rs 100 crore.
While the management of HPL had earlier asked for a fund of Rs 1,000 crore, the lenders had agreed to infuse cash in small tranches. "Ultimately it would go up to Rs 1,000 crore. The prospect of the plant was helped by the fact that the price of naphtha, main raw material for a petrochemical plant, fell sharply in the world market," said the government official.
"While earlier it was impossible to run the plant at an optimum capacity without a capital of Rs 1,000 crore, now we have told the lenders that even Rs 600 crore would be enough to restart the plant," the HPL official explained.
Having resolved the crisis at HPL, it was likely that the state government and TCG would now sit across and discuss the share purchase agreement. The state government has decided to hand over its shares to TCG, but the transaction is pending.
The reopening of HPL will finally bring relief to the downstream units who were staring at a bleak future after the closure. "The plant has already started despatching products, we also had a talk with the HPL management who assured us that the plant would function at optimum level," said Ramesh Rateria, vice-president of Indian Plastics federation (IPF).
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