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Indian Oil to invest Rs 1.8 trillion to expand refineries, new businesses

Indian Oil to invest Rs 1.8 trillion to expand refineries, new businesses

MUMBAI: Indian Oil Corp. Ltd, the nation’s biggest refiner, will spend Rs1.8 trillion over the next 5-7 years to expand refining capacity and build its new businesses, chairman Sanjiv Singh said at the company’s annual general meeting in Mumbai on Tuesday. Indian Oilis expanding its Barauni and Gujarat refineries to boost savings and improve energy efficiency. “Apart from capacity expansion, a new large-size single crude unit will be incorporated in place of several existing small units for efficient operations. Expansions of Panipat and Paradip refineries are also under consideration along with various petrochemical options,” Singh said.

Indian Oil, which is expanding in petrochemicals and gas marketing, is acquiring equity in gas imports at Ennore and on the east and west coasts at Dhamra and Mundra respectively, as a joint venture partner, Singh added.  Over the years, Indian Oilhas been expanding into newer areas. While in the pre-1999 era, Indian Oil was only a refining and marketing company, post 1999 it has expanded into petrochemicals and natural gas. From 2009 onward, the company has expanded in the upstream or exploration and production sector as well as alternative energy.

Indian Oilhas a 20% market share in the petrochemicals segment with the business contributing to almost a quarter of the company’s profitability, Indian Oil said. The company has so far implemented petrochemicals projects worth Rs20,800 crore. In addition, a polypropylene unit is being set up at Paradip at an investment of Rs3,150 crore. “In view of the growing demand for petrochemicals, especially polymers or plastics, Indian Oilhas ambitious plans to invest about Rs32,000 crore more in petrochemicals projects. These would include revamp of existing capacities; new projects for production of mono ethylene glycol and petcoke gasification at Paradip among others,” Singh’s statement added. During the last financial year, Indian Oilhas acquired participating interest in two oil and gas assets in Russia as part of an Indian consortium which would bring in 104 million tonnes of oil and 1.5 trillion cubic feet of gas reserves to India. IOCL’s stock fell 1.20% to Rs434.60 on BSE, while the exchange’s benchmark Sensex shed 1.14% to 31,388.39 points.