Essar Oil, the country's second
largest private refiner,
announced that it has completed
its optimisation project,
which has taken the capacity of its
Vadinar Refinery in Gujarat to 20
million tpa, or 405,000 barrels per
day. The optimisation project has
been completed four months
ahead of schedule.
Essar Oil had completed the
refinery expansion project to raise
its nameplate capacity from 10.5
million tpa to 18 million tpa with
an investment of
Rs 9,100 crore.
For the optimisation project, Essar
Oil invested an additional
1,700
crore, taking the total investment
at Vadinar Refinery to approximately
24,000 crore.
The company now accounts for
about 10 per cent of India's total
refining capacity.
Essar Oil set up the refinery at a
low capital cost of $12,746 per
barrel, which is about half the
global average.
"We are very happy to announce
the completion of our Optimisation
Project much ahead of schedule…
With this commissioning,
our capex cycle has now come to
an end and we are fully geared to
deliver the value of our investments
to all our stakeholders,"
said Lalit Gupta, MD & CEO,
Essar Oil.
Under the optimisation project,
visbreaker unit has been converted
into crude distillate unit to
process ultra heavy/tough crude
on standalone basis, which will
drive significant improvement in
economics. Secondary units
required to support additional
throughput along with other supporting
infrastructure (pipelines,
tankages, blending facility etc.)
are also completed as a part of the
optimisation project.
Vadinar Refinery now has the
capability to process much heavier
crude diet. The share of ultra
heavy crude will go up to 60 per
cent and, as a result, the overall
share of heavy and ultra heavy
crude will go up to 80 per cent of
the refinery's total crude basket.
The company has already entered
into long-term crude sourcing
contracts with global suppliers,
including several national oil
companies from Latin America.
Higher value products
In terms of product yield, Vadinar
Refinery now has the flexibility to
produce higher value, high-quality
products, including gasoline
(petrol) and gas oil (diesel) conforming
to Euro IV & Euro V
norms, that have growing acceptance
in both domestic and international
markets.
Close to 80 per cent of its production
will now be of valuable light
and middle distillates; and more
than 50 per cent of the production
of gas oil (diesel) and gasoline
(petrol) will meet Euro IV & Euro
V specifications.
Essar Oil is targeting newer
markets such as Australia, New
Zealand and northwest Europe, in
addition to countries in the Indian
subcontinent for exporting highquality
fuels. However, Essar Oil
will continue to market a majority
of its products in the domestic
market.
Untitled Document
Salient Features |
- Refinery Optimisation
Project completed four
months ahead of schedule.
Completion of this
project marks the end of
the capex cycle. The company
is now geared to
enjoy significant upside in
margins.
- Vadinar Refinery accounts
for about 10 per cent of
India's refining capacity.
- Invested over 10,000
crore in expanding capacity
to 20 million tpa and
improving complexity to
11.8
.
- Total investment till date
at Vadinar approximately
24,000 crore for 20 million
tpa. Capital cost at
Vadinar Refinery half the
global average for capacity
creation.
- Refinery now capable of
processing over 80 per
cent of ultra heavy and
heavy crude in its crude
diet and produce higher
grade products like Euro
IV & V compliant gasoline
and gas oil to cater to the
domestic and international
markets.
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