In a likely indication that it seeks to resolve the impasse over ownership issues at Haldia Petrochemicals (HPL), the West Bengal Government on Monday allowed the private partner Mr Purnendu Chatterjee to officiate as Chairman of the company through a temporary arrangement.

Mr Chatterjee is currently the Vice-Chairman of the joint venture between the State Government and The Chatterjee Group.

According to sources, according to the arrangement, during Monday's meeting, the company's board of directors appointed Mr Chatterjee as Chairman till the next meeting. To put it simply, his tenure as Chairman should be renewed at successive board meets.

The arrangement will continue till the Supreme Court gives its verdict on the legal dispute between the two promoters over management control. According to the State Government, until the legal issues are resolved, Mr Chatterjee cannot be offered the chairmanship of the company for a fixed tenure.

18-day shutdown

Meanwhile, HPL is going for a planned shutdown for 18 days beginning today. The shutdown should help the company to cut losses in the existing adverse market conditions and also address some maintenance issues.

According to company sources, a substantial part of the petrochemicals industry around the world is currently on a shut-down mode. “With a reduction in global supply, the petrochemicals product prices are expected to move up in August-September,” a company official said.

Meanwhile, the financial health of the company has improved following waiver of the import duty on naphtha by the Centre. However, the State Government has yet to resume the sales tax remission scheme on motor spirit.

Published on July 19, 2011