ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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From 50 Years Ago: Explosive Assam.

Weekly Note from Volume IX, No 25, June 22, 1957. 

The violence of the reaction in Assam to any suggestion of locating the refinery outside the State should not surprise anyone who has cared to follow developments in this strategic border State. Assam has yet to attain homogeneity and political maturity. What has appeared so far is only a mild warning. If it is not handled properly, the situation may well become explosive. On a question like this, which is of such vital interest to India and her future development, compromise is just not possible and the least that the Government can do is to put the facts before the public. There is no political advantage in withholding the cost data on the basis of which the expert committee arrived at the conclusion that the advantages are overwhelmingly in favour of locating the refinery in a port town, either Calcutta or nearabouts. The capital cost per ton mile of pipeline for carrying all the crude to Calcutta is roughly only a third of the capital cost of carrying part of the crude to Gauhati and part to Calcutta. The recurring costs in the two cases are also in about the same proportion.

The over-riding consideration to which everything else is subordinate is that of easy export and import of crude which can be ensured only if the refinery is located in a port. Supplies from no oil field can be depended upon to be steady. A refinery cannot be put on stream or shut off according as supply of crude is available or not, without making costs of operations uneconomic nor can the capacity of the refinery be quickly adjusted to fluctuating supply of crude. Therefore an export outlet is needed for any excess supply of crude that may be forthcoming and with the three refineries, all readily accessible by sea, the advantages of location by the sea can hardly be overexaggerated. Nor can the necessity of importing crude, to supplement domestic production or to feed the refinery, if necessary, be questioned. While there would not be much difference in the capital cost of erecting the refinery, whatever the site chosen, the total outlay will differ significantly when the cost of ancillary service, e g, railways, pipelines for transport and the refined product by rail, freight on machinery, equipment and operating stores, etc, are taken into consideration. All the crude can be carried by one pipeline, but not all the refined products.

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