UPDATE 1-HPCL, Shree Renuka to set up sugar plant for ethanol

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MUMBAI, Sept 11 (Reuters) - State-run refiner Hindustan Petroleum Corp Ltd (HPCL.BO: Quote, Profile, Research) and sugar producer Shree Renuka Sugars Ltd (SRES.BO: Quote, Profile, Research) said they have signed a deal to set up a sugar plant with facilities to produce ethanol in Maharashtra.

The unit will be set up through a joint venture, the companies said in separate statements to the stock exchange.

It would be an integrated sugar and ethanol plant where the ethanol capacity would be 240 kilo litres per day and a co-generation power capacity of 30 mega watts, Managing Director, Narendra Murukumbi said on CNBC-TV18.

"Sugar will be the by-product and ethanol will be the main product," he said.

He said the exact details were to be worked out and added that strong demand for ethanol across the country prompted the joint venture.

(Reporting by Bharghavi Nagaraju, Kaustav Roy and Nandita Bose; Editing by Ramya Venugopal)