Should Mumbai refineries be shifted out of city? Chembur fire revives debate

Smoke rises out of fire which broke out after a blast at BPCL Mahul refineries | PTI

Experts have raised environmental and security concerns, suggested phased relocation of such industrial units in the past, but no action so far.

Mumbai: The massive blast and fire at a Bharat Petroleum Corporation Limited (BPCL) refinery in Mumbai’s Chembur Wednesday has revived the debate on relocating such industrial units, flanked by thickly populated areas, out of the city.

Not far from the spot where the incident took place are other chemical and industrial establishments — a refinery of Hindustan Petroleum Corporation Limited, units of Rashtriya Chemical Fertilisers (RCF) and a Tata Power thermal plant.

Going south from Chembur are oil tank farms around the Mumbai Port Trust and a mountain of imported coal dumped at Sewri.

For years, courts, local authorities, political leaders as well as organisations that run these refineries have raised concerns over the thick population density and rampant development around these installations that not only raise environmental, but also security concerns. However, there has been no concrete action so far.

‘Plan phased relocation of refineries’

“The current scenario is quite serious,” environmentalist Rishi Agarwal said.

“In case of RCF, it is not just the chemical nature of the unit, but also the large quantities of ammonia that are hazardous. Looking at the seriousness of the matter, the government should have formed a task force to evaluate options for relocating the units,” he added.

Over the past decade, there has been intermittent talk of the government exploring possibilities of moving the BPCL and HPCL refineries out of Mumbai, somewhere along the Konkan coast, but no action has been taken so far in this regard.

“The possibility was discussed, but there is no plan on the table. Relocation is too drastic a step because the costs involved are too high for these companies to be able to bear,” an official from Maharashtra’s industries department said.

“Meanwhile, the refineries are taking active steps towards reducing emissions, curbing pollution, improving safety, etc,” the official added.

In 2011, then BPCL chairman R.K. Singh said in an interview to BusinessLine that relocating the Mumbai refinery and replicating the business model with access to supplementary infrastructure and a port and so on are not easy. Setting up a new refinery will require more than Rs 25,000 crore investment, he had said.

Agarwal suggested tapping the land value of the existing refinery to fund the relocation. “The cost of the real estate these refineries occupy is huge and there is definitely a win-win in this,” he pointed out.

“Potentially after rehabilitation of the refineries, the land can be used to create affordable housing, playgrounds and more open spaces for the city,” Agarwal said.

The BPCL Mumbai refinery is spread over 454 acres of prime land. HPCL too has nearly 340 acres in the city, while RCF too is estimated to own about 785 acres of land around its Trombay plant near Chembur.

Pankaj Joshi, executive director of the Urban Design Research Institute (UDRI), said, “We cannot be over-zealous and say shift the refineries out immediately. They serve the needs of the entire western zone and relocation will require an investment of crores.”

“With that in mind, what the government can do immediately is be very diligent of maintaining the buffer zone required around these refineries. Simultaneously, we can start a plan of shifting them out in phases over the next 10 to 15 years,” Joshi said.

Need better management techniques for city

BPCL’s Mumbai refinery was commissioned in 1955, while the HPCL unit came up in 1952. At that time, Chembur was a distant, sparsely populated area considered to be outside the city.

Urban planner Sulakshana Mahajan said, “The problem is not with the refineries, but with the city, which has not been managed properly. The refineries were very much planned outside.”

She argued that development could have been limited, but now the government is giving out a floor space index (FSI) — the ratio between the area of a covered floor (built-up area) to the area of the plot (land) on which a building stands — of over 4 and 5 in these localities.

“Authorities blame it on the population, but the problem is with the poor management techniques for the city,” she claimed.

Besides allowing a clutch of private high-rises around the refineries, the government itself has constructed transit camps, the monorail and the Eastern Freeway in the Chembur area. Each time, the oil corporations had written to state authorities raising security concerns.

In 2013, the Supreme Court had also come down heavily on state and civic authorities for giving permissions for residential and commercial development close to the refineries while hearing an appeal filed by developer Oswal Agro Mills Ltd against a Bombay High Court order.

The high court had ruled in favour of HPCL, which was seeking cancellations of development permissions granted for residential and commercial construction on land less than 500 metres from its refinery in Mahul, Chembur.

The Supreme Court in its order said, “The municipal corporation and the state of Maharashtra ought to have checked and stopped these constructions, particularly the high-rise ones in the vicinity of these installations, but they have failed in doing the same. It cannot, however, justify further dereliction of their responsibilities.”

“Two wrongs do not make one right,” the order said.