The three firms signed the pact for the 60-million tonne a year refinery in Maharashtra with IOC as leader of the consortium, officials said.

IOC will hold a 50 per cent stake in the project while BPCL and HPCL will have 25 per cent each. The consortium agreement was signed on the sidelines of the Petrotech conference here.

Oil Minister Dharmendra Pradhan said oil majors like Saudi Aramco of Saudi Arabia are interested in taking a stake in the project, but nothing has been finalised as yet.

"There are other companies also interested. Let's see how talks progress," he said.

The 60-million tonne a year refinery and a mega petrochemical complex will be set up in two phases.

Phase-1 capacity will be 40 mt together with an aromatic complex, naphtha cracker unit and a polymer complex. This will cost Rs 1.2-1.5 lakh crore and will come up in 5-6 years from the date of land acquisition.

The mega complex will require 12,000-15,000 acres and two-three sites on coast of Maharashtra are being explored.

The second phase, involving a 20-mt refinery, will cost Rs 50,000-60,000 crore.

IOC has been looking at the west coast for a refinery as the company found it tough to cater to requirements in West and South with its refineries mostly in the North.

HPCL and BPCL too have been looking at a bigger refinery because of constraints they face at their Mumbai units.

The mega west coast refinery will produce petrol, diesel, LPG, ATF and feedstock for petrochemical plants in plastic, chemical and textile industries in Maharashtra.

Fifteen-million tonne a year is the biggest refinery any public sector unit has set up at one stage. IOC recently started its 15 mt unit at Paradip in Odisha.

Reliance Industries holds the distinction of building the biggest refinery in India till now. It built its first refinery at Jamnagar in Gujarat with a capacity of 27 mt, which was subsequently expanded to 33 mt. It has built another unit adjacent to it for exports, with a capacity of 29 mt.

The refinery being planned by the state-owned firms will be bigger than that. The phase-1 itself will be bigger than any one single unit.

India has a refining capacity of 232.06 mt, which exceeded the demand of 183.5 mt in 2015-16.

According to the International Energy Agency (EA), this demand is expected to reach 458 mt by 2040.