(Bloomberg) -- Engineers India Ltd. is expected to complete the construction of Mongolia’s first 1.5 million ton oil refinery by March 2026, the company’s chairman said Wednesday.
Work is not easy but the project is moving well, Vartika Shukla said during a media briefing in New Delhi, without elaborating on an expected commissioning date.
The $1.7 billion project, which is financed by the Indian government, will help the eastern Asian nation use its domestically produced crude to make transport and cooking fuel for local use. Mongolia currently exports most of its crude to neighboring China.
The upcoming refinery is the single largest line of credit project being funded by India across the world. Under that program, the country offers concessional interest rates to developing nations, on the condition that 75% of the contracts are signed with Indian companies.
The project is a test of the state-run engineering firm’s ability to handle construction in harsh climates. The works, which started in 2019, have been delayed due to the Covid outbreak and inhospitable weather.
Work at the site could only be carried out between April and October as temperatures fall below zero for the rest of the year, Shukla told reporters. The site experiences weather ranging from 38 to -35 degree Celsius, with frequent sandstorms.
The lack of manpower and Mongolia being landlocked also slowed construction. Materials had to be shipped by sea and enter its borders by crossing a third nation, traveling almost 1,100 kilometers in the destination country alone.
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