The Paradip Refinery of Indian Oil, which is set to be dedicated to the nation on February 7, will massively boost the bottomline of the largest oil marketeer to the tune of 20-30 per cent, thanks to the latest technologies deployed at the facility that’s coming up after a delay of 14 long years.
The massive delay in completing the project has led to a cost escalation of over Rs 3,500 crore at Rs 34,555 crore and an interest payout of Rs 7,500 crore, the company said.
The commissioning of Paradip Refinery by Prime Minister Narendra Modi on February 7, will take the total number of IOC refineries to 11. Its last greenfield refinery was commissioned in 1998 at Panipat which has an annual capacity of 15 million metric tonne (mmt).
Paradip is also the first greenfield coastal refinery of Indian Oil.
“This refinery will boost our profit by as much as 20-30 per cent from next year. Testing and trial runs of various units have now been completed, with the petrol unit being the latest one to go on-stream on January 17.
“From next month, we will be operating at 60 per cent of its 15 mmt capacity,” IOC executive director and Paradip Refinery in-charge Ramjee Ram told PTI during a recent plant visit.
Ram said his optimism comes from the fact that the refinery is likely to boost the average gross refining margin of Indian Oil by USD 6-7 a barrel to USD 15-16 a barrel next fiscal at the prevailing crude prices from the present low level of USD 10-11 a barrel.
He further said the refinery will be using mostly high sulphur crude, though it can refine all types of crudes and one of the reasons for high profitability is this focus on high sulphur/heavy crude which is cheaper by USD 2-3 a barrel.
IOC hopes to procure the crudes from Latin America and Angola for Paradip, which are mostly heavy crudes. IOC will use the output serve Odisha, Jharkhand, MP, Chhattisgarh and Andhra markets apart from export to Southeast Asian countries.
The refinery will turn 15-million metric tonne of crude per annum into petrol, diesel, cooking gas, kerosene, aviation fuel and naptha.