BPCL, the public sector oil marketing company, has emerged the main contender to revive the stalled Nagarjuna Oil Corporation’s refinery project in Tamil Nadu.

With the committee of creditors appointed by NCLT to meet tomorrow to consider the bids, there are just two bidders in the fray. One is the public sector company and the other an unlisted venture for the creditors to consider, according to reliable sources.

The Hyderabad-based Nagarjuna Oil Corporation was setting up the 6-million-tonne a year refinery at Cuddalore on the East Coast about 200 km to the south of Chennai. The project scheduled to start in 2002 was hit by cost over-runs. Project cost ballooned to ₹12,500 crore from ₹3,500 crore initially. In December 2011, the project site was hit by a cyclone and was stalled.

The total investment in the project at that time was estimated at ₹8,000 crore, including ₹4,500 crore expenditure and ₹3,500 crore interest. A consortium of 17 banks led by IDBI which funded the project was to have brought in an additional ₹7,000 crore debt as part of a restructure which did not materialise.

NCLT appointed a Resolution Professional last July after a bidder, Netoil Consortium, which was to bring in over ₹3,800 crore as part of a one-time settlement, failed to bring in funds. The State government had cleared a structured package of incentives to Netoil during the Global Investors Meet in 2015.

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