Sainshand Refinery: India extends $1 billion Line of Credit to MongoliaDate: 15 May 2019 Tags: India & World
India has extended US $1 billion Line of Credit (LOC) to Mongolia to set up its first-ever petrochemical refinery at Sainshand in Dornogobi Province. It is the largest project undertaken by India under its LOC programme. It will be implemented with EXIM Bank. The funding was announced by Prime Minister Narendra Modi during his visit to Mangolia in 2015. The refinery project is one of the important milestone in bilateral relations between India and Mongolia.
- Its construction was started in June 2018 and is expected to be completed by 2022. It will be built at cost of around US $1.25 billion, of which, US $1 billion is provided by India as line of credit.
- The refinery will be capable of processing 1.5 million tonnes of crude oil per year (about 30,000 barrels per day (bpd)).
- On completion, it will help to meet all of Magnolia’s demand for gasoline, diesel, aviation fuel and liquefied petroleum gas (LPG).
- It will make landlocked Mongolia independent from energy imports (currently dependent on Russia) and stabilize its fuel and commodity prices in its domestic markets.
- It is expected to increase Magnolia’s crude oil output, helping it to increase its export earnings by exporting refined products to China.