Five businesses, including Total and Oil India have been given until December to decide whether or not they wish to push ahead with a planned £3 billion refinery at Vizag in India.

Last October, the two firms signed an agreement along with Mittal, Hindustan Petroleum and GAIL, regarding the establishment of a new 15-million tonne refinery as well as a one-million tonne petrochemical complex in the region.

Though the capacity of the planned site has now been reduced to 14 million tonnes due to feasibility issues, all the companies involved have now signalled their intent to follow through with the initial agreement, setting themselves until the end of the year to make a final decision.

"The pre-feasibility study is on. Before the end of the year we will know if we will move ahead with the project," confirmed Thierry Pflimlim, senior vice-president, Total Asia-Pacific.

However, while independent analysts have noted that the petrochemical market in South-East Asia has significant room to grow, thereby making any proposed refinery on the east coast of India financially feasible, just last month the Oil and Natural Gas Corporation (ONGC) pulled out of a similar venture, citing economic reasons.