Monday, January 11, 2016

Paradip refinery: IOC may spend Rs.4,000 cr more to provide BS VI fuels

Indian Oil’s brand new 15 million tonne per annum refinery in Paradip, Odisha, will soon have to spend Rs.4,000 crore more to upgrade and install some new units for providing BS VI grade automotive fuels by April 2020.

While the company is currently drawing up the plans, the investment could come soon since the units will need to be in place by December 2019.

Earlier this week, the Ministry of Petroleum and Natural Gas, Ministry of Heavy Industries, Ministry of Environment Forests and Climate Change and Ministry of Road Transport and Highways agreed to implement the BS VI emission norms by April 2020 instead of the earlier date of April 2021.

It was also decided to move straight from BS IV, which will be implemented by 2017, to BS VI. “We (Paradip refinery) would require an additional investment of Rs.4,000 crore. Some additional units may be required and others will need to be upgraded to BS VI grade fuels," said GS Singh, Executive Director (Technical) at Indian Oil Corporation.

The refinery was set up at a cost of Rs.34,555 crore and is spread across 3,344 acres. Most of the refinery's units were commissioned during 2015-16.

The refinery has already started selling petrol, diesel, kerosene and LPG. During January and February, the refinery will run at 60 per cent capacity. Singh said that in the 2016-17 fiscal the refinery will operate at 60-80 per cent of its capacity and reach full capacity by 2017-18. At full capacity, the IndianOil officials expect Paradip refinery's contribution to the company's net profit at 20-30 per cent.Further, a petrochemical plant will also be in place by 2017, Singh said. “Work has already started. We should be commissioning it by 2017,” he added.

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