UPDATE 1-India HPCL to start Euro III diesel early next yr

* Producing Euro III petrol at Mumbai; to start soon at Vizag

* Euro IV petrol likely at both refineries by year end (Recasts lead, adds details on Euro III diesel production, other units)

MUMBAI Aug 28 (Reuters) - India's Hindustan Petroleum Corp (HPCL.BO) will start producing Euro III diesel, a superior quality fuel, from its Mumbai and Vizag refineries by early next year, Chairman and Managing Director Arun Balakrishnan said on Friday.

The company has started producing Euro III quality petrol at its Mumbai refinery and hopes to start producing it at its Vizag refinery soon, Balakrishnan said.

"Our refinery upgrade projects for producing cleaner fuel are on track," he told the company's annual meeting of shareholders.

He said Euro IV quality petrol would be available at both the refineries by the end of the year.

The Euro IV specifications are being enforced from April 2010 in 11 big cities that currently sell Euro III fuels.

The rest of the country, where fuels of lower standards are sold, will upgrade to Euro III.

Balakrishnan said a new fluid catalytic cracker unit at the Mumbai refinery would be complete by the middle of next year. (Reporting by Ami Shah; Editing by John Mair)