Business Daily from THE HINDU group of publications
Wednesday, Dec 20, 2006
ePaper
Business Daily from THE HINDU group of publications Wednesday, Dec 20, 2006 ePaper |
|
|
|
|
|
|
|
Corporate
-
New Projects Industry & Economy - Petroleum States - Gujarat Essar dispatches first cargo to British Gas Virendra Pandit
Expansion plans Essar said the current capacity of 10.5 mt at the refinery could easily be increased to 12 mt. It has, so far, set up 900 retail outlets and plans to increase the number to 2,500 by end-2007.
THE ESSAR REFINERY
Jamnagar , Dec. 19 Less than a month after commissioning its refinery on November 24 at Vadinar, Essar Oil Ltd (EOL) announced on Tuesday that it is dispatching the first cargo of 35,000 tonnes of vacuum gas oil (VGO) to British Gas. Essar said it would consider doubling its current capacity of 10.5 million tonnes (mt) with an investment of up to Rs 3,000 crore and a complexity index from the current 5.8 to more than 8 to produce petrochemicals. The refinery has an utilising capacity of 7.5 mt, which would be increased to its full capacity by March next year. The first consignment was loaded in a product tanker at Essar's port at Vadinar. The second consignment of another 35,000 mt of naphtha was also on the jetty for shipment abroad. With an increasing complexity index, profit margins would go up, as the refinery would be able to refine crudest oil into finest products economically.
Sharing with RIL
Besides, Essar has also started sharing product and infrastructure with Reliance Industries Ltd to avoid duplication of facilities, as do the public sector units in the sector, said its Managing Director, Mr A.N. Sinha, in an interaction with visiting journalists. This product exchange is currently for the domestic market in which the two companies would share each other's infrastructural facilities across the country, beginning with seven coastal facilities Essar has. Essar is now on the threshold of buying oil from the PSUs, as it readies to set up its retail chain of 2,500 outlets by end-2007. Mr Sinha said the current capacity of 10.5 mt at the refinery can easily be increased to 12 mt. Replying to questions, he said oil has already been struck at the Mehsana field in Gujarat and exploration was on for coal bed methane (CBM) there.
Upstream portfolio
In its upstream portfolio, Essar has Indian exploration blocks in the Cambay Basin, Mehsana (50-70 million barrels), Cachar in the Assam-Arakan Basin (two TCF gas), CBM exploration block at Raniganj Coalfields in West Bengal, a development field at Mumbai Basin in Ratnagiri and overseas exploration blocks in Myanmar and Madagascar. The company was also in the process of signing an MoU with ONGC for the Ratnagiri offshore exploration. The refinery's current capacity of 10.5 mt per annum represents seven per cent of India's total refining capacity. Essar will produce entire range of products ranging from LPG to fuel oil to meet international standards. The refinery is configured in a manner that allows it the flexibility to process diverse varieties and qualities of light, heavy, sour and sweet crude. The input for the first consignments of sweet crude it refined were imported from West Asia and Nigeria. Most of its refined products would be exported now but furnace oil would be sold domestically from March next year.
Project cost
The project cost of the refinery, mooted about 12 years ago, has been to the tune of Rs 10,826 crore. Besides, Essar boasts of its dedicated Vadinar Oil Terminal, an integrated facility built at a cost of Rs 2,857 crore to receive crude through a single-point mooring system (SBM) and dispatch of finished petroleum products through its product jetty. The terminal can handle 32 mt per annum of crude intake with a capability of handling tankers up to 3.50 lakh deadweight tonnage and product dispatch facilities with an annual capacity of 14 mt . Essar has also set up the Vadinar Power Company to generate 120 mw of power at its co-generation plant and feed both power and process steam for the refinery. About marketing, Mr Sinha said, the location of the refinery was ideal to get crude from West Asia and ship the finished products to the emerging markets in South East Asia. In the domestic market, the private players were losing anywhere between Rs 2 and 4 per litre in retail due to the subsidies being given to the PSUs. He said the company has not set up many retail outlets in low-demand areas like parts of Madhya Pradesh, Orissa, Chhattisgarh and Jharkhand.
More Stories on : New Projects | Petroleum | Gujarat
Article E-Mail :: Comment :: Syndication :: Printer Friendly Page
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | The Hindu ePaper | Business Line | Business Line ePaper | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2006, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|