Chennai Petroleum, Karaikkal Port ink deal on crude carriers
New Delhi   14-Sep-2011


Mr R.S. Butola, Chairman, CPCL and Mr K. Balachandran (left), Managing Director, at the AGM of CPCL, in Chennai on Monday.

Chennai Petroleum Corporation Ltd, which runs a 0.5-million-tonne, mini refinery near Nagapattinam, has entered into an agreement with Karaikkal Port Pvt Ltd for bringing in bigger crude carriers, CPCL's Chairman, Mr R S Butola, said on September 13, 2011.

Addressing the shareholders in Chennai, Mr Butola said that the Rs 10-crore project for constructing a pipeline between Karaikal port and the Cauvery Basin Refinery would be completed by December.

The completion of the project is significant for CPCL because now that there is scope for bringing in larger quantities of crude oil, it can now think of doubling the capacity of the refinery. Indeed there is such a plan.

Meanwhile, CPCL is on to another project to raise the capacity of one of it units at the Manali complex near Chennai, from 3.7 million tonnes to 4.3 million tonnes, at a cost of Rs 334 crore. The project is expected to be completed by May next year.

Alongside these “mini expansion projects,” CPCL also has plans to put up 6-million-tonne greenfield refinery near its Manali complex.

Mr Butola said that IndianOil projects that the supply-demand gap in the CPCL-fed zone (neighbourhood of Chennai and some parts of Tamil Nadu) will be 2.7 million tonnes by 2017 and 5.6 million tonnes by 2022. “Our company is contemplating an expansion in refining capacity to bridge this gap, he said.

Status quo

Later, in an informal chat with journalists, Mr Butola said that IndianOil was still looking for a partner for the Rs 3,000-crore LNG terminal project proposed at Ennore.

Answering a question, he said that IOC hoped it would be allowed tax sops for its Paradip refinery project, even though the commissioning of the project will now happen after the expiry of the deadline for the entitlement of the sops.