News Desk - India is helping build Mongolia’s first oil refinery in Dornogovi province through a $1.7 billion government-backed line of credit, marking one of India’s largest overseas development projects. The refinery is expected to begin operations by 2028 and is seen as a major boost to Mongolia’s energy security.

The refinery is being built in Altanshiree soum, Dornogovi aimag, with a planned capacity of 1.5 million metric tons of crude oil a year, or about 30,000 barrels per day. It is Mongolia’s first domestic oil-refining facility and is meant to reduce the country’s dependence on imported fuel by supplying petrol, diesel, and LPG locally.

Construction has moved through several stages, with Megha Engineering & Infrastructure Limited handling the latest EPC package and Indian firms involved in earlier planning and supervision. Reports say the project includes 12 technological facilities, with seven deep-processing units licensed from companies in France, Italy, the United States, and the Netherlands, while the work faced delays because of the pandemic, logistics issues, and Mongolia’s harsh winters.

The refinery is strategically important for both nations: Mongolia gains a domestic energy base, while India deepens ties with a key partner in Central Asia and showcases its overseas infrastructure capacity. Once completed, the project could significantly reduce Mongolia’s fuel import dependence and stand as a flagship example of India’s development partnership abroad.