Indian Oil to upgrade Paradip refinery in Odisha

Indian Oil (IOC) is reportedly planning to invest Rs40bn ($597m) to upgrade its Paradip refinery in the Indian state of Odisha.

Reuters reported a senior company executive saying that 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 recently to introduce the BS VI emission norms within four years instead of April 2021.

The agreement will see the introduction of road vehicle fuels that are compliant with Euro VI emission standards to combat increasing pollution in India.

The refinery is spread across 3,344 acres and was commissioned in 2015. It has a capacity of 300,000 barrels per day.

Paradip refinery, which was designed to produce Euro IV and Euro V-compliant fuels, now requires installation of some new units in addition to upgrading existing ones.

In order to produce Euro VI compliant fuels at the refinery, IOC is required to add facilities such as isomerisation, diesel hydrotreater and a hydrogen unit.

The company will commission a reformer, and vacuum gas oil hydrotreater at the refinery in January 2016. In February 2016, an alkylation unit will be in place.

The refinery is expected to run at up to 60% capacity in the current fiscal year to 31 March 2016 and may further increase to 80% upon commissioning of the other new units.

Paradip will account for 20-30% of IOC’s overall profit when it operates at full capacity from the fiscal year 2017/18.

Initially, the refinery was expected to commence operations in 2012, but got delayed due to various problems.