To invest Rs 50 crore in the 290-km pipeline

M. Ramesh

Overview


CPCL is

on a mini-expansion project under which its capacity will increase by 1.7 million tonnes (mt) from the present 9.5 mt.

It will

invest Rs 56 crore in putting up two more tanks to store crude oil, to meet the additional need for storage capacity after the expansion.

Chennai, Aug. 9

The Chennai Petroleum Corporation Ltd (CPCL) will pick up a stake in the company that would put up the Chennai-Bangalore pipeline project, CPCL's Managing Director, Mr K.K. Acharya, told

Business Line

.

The 290-km-long pipeline, meant to carry petrol, diesel and kerosene from CPCL's refinery in Chennai to "Bangalore-fed areas", will be put up by a special purpose vehicle created by CPCL's parent company, Indian Oil Corporation.

It is learnt that CPCL will invest up to Rs 50 crore in the project.

The Chennai-Bangalore pipeline is the second of two pipelines meant to evacuate the products of the refiner. The other one is the 683-km Chennai-Tiruchi-Madurai pipeline, which became operational in June.

CPCL is on a mini-expansion project under which its capacity will increase by 1.7 million tonnes (mt) from the present 9.5 mt. The Rs 330-crore project consists of two parts de-bottlenecking of the Unit-III at a cost of Rs 130 crore, which will add 1 mt, and revamping of the old Unit-I at a cost of Rs 200 crore, which will raise capacity by another 0.7 mt.

A formal approval of the board of directors for the first part of the project will be sought on August 25, Mr Acharya said.

Once the expansion project is through the need for easy evacuation of the products will be more acutely felt. The Chennai-Bangalore pipeline will help reach the products to consumption points.

Investment in tankage

In the meantime, CPCL will invest Rs 56 crore in putting up two more tanks to store crude oil, to meet the additional need for storage capacity after the expansion. Each of the proposed two tanks can hold 50,000 kilo litres of crude oil.

At present, the company has 15 tanks, each with a capacity of 62,000 kilo litres. They can store 22 days' requirement of crude oil, the company's Director-Technical, Mr S. Chandrasekaran, said.The company will further be spending Rs 65 crore on replacing the existing 30-inch crude pipeline connecting the port and the refinery, with a 42-inch pipeline. The project is awaiting a formal right-of-way approval from the Tamil Nadu Road Development Company.

Mr Chandrasekaran said that nearly half of the 17-km pipeline would run along the Ennore expressway that is being built by the company.

The pipeline revamp project is expected to be completed by December 2007.

(This article was published in the Business Line print edition dated August 10, 2006)
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