Funding issues force Adanis to delay petrochemical project in Ahmedabad

NEW DELHI: Delay in financial closure has forced the Adani group to suspend work on the Rs 34,900-crore petrochemical project in Ahmedabad. Adani Group on Monday clarified it has decided to keep the major equipment procurement and site construction activities on hold as it is waiting for the financial closure of the Green PVC project of Mundra Petrochemicals (MPL).

“The financial closure of the Green PVC project of MPL is pending with the financial institutions and it is in their active consideration,” a spokesperson of the company said on Monday adding that it is hopeful to obtain financial closure for the project in next six months after which full-fledged procurement and construction activities at the site will commence.

However, the firm has said that it has decided to continue with the engineering design and other activities in an accelerated mode. It was reported by PTI on Sunday that the group has decided not to pursue the 1 million tonne per annum Green PVC project for the time being.

The group has shot off mails to vendors and suppliers to suspend all activities on immediate basis. PTI had cited mails sent by the company to its vendors in which it has asked them to “suspend all activities of the scope of work and performance of all obligations” for Mundra Petrochem Ltd’s Green PVC project till further notice. The management, it said, was “re-evaluating various project/s being implemented at group level in different business verticals.

Based on future cash flow and finance, some of the project/s are being re-evaluated for its continuation and revision in timeline.” The PVC unit was to have a production capacity of 2,000 KTPA (kilo tonne per annum) requiring 3.1 million tonne per annum (MTPA) of coal that was to be imported from Australia, Russia and other countries.