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Indian Oil Corporation (IOC), the country’s biggest refiner and fuel retailer, plans to invest US$4.46 billion (329.46 billion Indian rupees) to expand the processing capacity of its Panipat refinery by two-thirds to 500,000 bpd within three years.
The refinery expansion project is set to boost petrochemicals production at the site, as well as specialty products that would contribute to de-risking “the conventional fuel business of the company,” Reuters quoted IOC as saying in a statement on Friday.
Petrochemicals are expected to contribute the most to global oil demand growth this decade, replacing road transportation fuel as the key driver of growth.
India, the third-largest importer of crude oil in the world and the third-largest consumer of oil, plans to significantly boost its overall refining capacity this decade.
Last year, India’s Oil Minister Dharmendra Pradhan said that the country planned to double its refining capacity by 2030 from the current 5 million barrels per day (bpd).
India aims to boost its refining capacity from the current 250 million tons per year (or around 5 million bpd) to 450-500 million tons a year (up to 10 million bpd) in next ten years, in order to meet growing domestic fuel demand as well as to export fuel, the oil minister said. The refinery capacity additions will consist of both expansion of existing refineries and the construction of new ones, Pradhan said at the end of June last year.
The top refiner in the country, Indian Oil, plans another expansion, at the Haldia Refinery.
Pradhan asked this week the Union Minister of Chemicals and Fertilizers and the Union Minister of State for Ports, Shipping & Waterways (I/c) & Chemicals & Fertilizers to help with the leasing of 175 acres of land that Indian Oil would use for the expansion of its Haldia refinery. This will enable the company to complete the construction of critical units to support refinery expansion that will help meet domestic demand in line with the prime minister’s vision, Pradhan tweeted on Thursday.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com