Mumbai: Indore-based Ruchi Soya Industries Ltd (RSIL) and oil major Indian Oil Corp. Ltd (IOCL) on Thursday signed a limited liability partnership agreement to form Indian Oil Ruchi Biofuels LLP with a total project cost of Rs436.63 crore. Part of the investment will be funded by the Uttar Pradesh state government under the National Rural Employment Guarantee Scheme (NREGS) scheme.
The equity of Rs126.67 crore will be funded equally by IOCL and RSIL. Consulting firm Ernst & Young was hired to asses the project. Indian Oil Ruchi Biofuels LLP will undertake jatropha plantations over 50,000 hectares in Jhansi and Lalitpur districts in UP. Jatropha seeds contain 30 % oil, which can be extracted and processed into biodiesel.
The firm will also set up an oil extraction unit and a transesterification plant of 300 TPD (tonnes per day). The UP state government had earlier approved Ruchi Biofuels Pvt. Ltd, a group company of RSIL, for inclusion in their bio-diesel value chain scheme, and had suggested that it tie up with any of the oil marketing companies.