IndianOil aims to double capacity with a refinery in west coast
New Delhi   17-Nov-2011

IndianOil (IOC) is considering setting up its eighth refinery in a western-coast State by 2021-22.

The country's largest refiner aims to double its crude refining installed capacity from 65.7 to 123 million tonnes per annum (mtpa) in the next 10 years, through expansion and new greenfield units.

At present, IOC is mulling to set up only a refinery — probably in Gujarat or Maharashtra — with an investment of nearly Rs 30,000 crore. However, a petrochemical plant may be set up later, along the lines of the Paradip refinery, Mr Raj Kumar Ghosh, Director (Refineries), told Business Line in Vadodara on Wednesday.

The cost is being worked out. However, he did not give a timeline for this project.

The capacity of the proposed refinery would also be 15 mtpa, as in Panipat and Paradip.

The upcoming Paradip refinery, India's most complex and IOC's biggest single investment of Rs 50,000 crore so far, is expected to be commissioned in the next Five-Year Plan. Earlier, the 2008 global economic meltdown had delayed the project's completion as IOC found funding difficult.

Viramgam-Kandla pipeline

The Rs 349-crore, 217-km-long product pipeline from Viramgam to Kandla in Gujarat is expected to be commissioned in a couple of months. It would provide cost-effective link with the sea-route ex-Kandla for coastal movement of surplus products of Koyali refinery and enhance flexibility in the system for ensuring sustained operation of the refinery.

Currently, IOC is importing 55 mtpa of oil and procuring 10 mtpa of indigenous crude for refining. It is exporting 1.5 mtpa of naphtha as a prelude to India's ambition to emerge as an exporter of petroleum products.

India's installed refining capacity is 193 mtpa, with private sector majors RIL and Essar accounting for 16 and 18 mtpas, respectively, the rest being with public sector refiners.

On the proposed expansion of Gujarat Refinery by 2016-17 from 13.7 to 18 mtpa at an investment of Rs 5,500 crore, Mr Ghosh said the feasibility report had been approved and IOC has entrusted Engineers (India) Ltd to draft a detailed project report. The project would be considered by the Board of Directors in December to take a final call.

IndianOil has also identified 75 acres near Koyali for acquisition.

The refiner is setting up an Rs 160-crore reverse osmosis plant at Koyli for effluent treatment to make the refinery safer and environment-friendly, Mr Ghosh said. The plant, with a capacity to recycle 1,600 metre cubes of water per hour, will be completed in two years.