Bizodisha Bureau, New Delhi, April 27, 2015 :

State-owned Indian Oil Corporation (IOC) has commenced crude processing from its Rs 34,555-crore Paradip oil refinery in Odisha and will start full-fledged production by the end of the year, said an IOC statement issued today.

“Crude processing has commenced…,” the company said in a statement.

“Some of the products will require further processing in secondary units, which are also gearing up for commissioning.”

The press statement further said, the whole 15-million ton a year refinery is likely to take about 6-8 months for becoming fully operational.

The refinery is designed to process broad basket of crude, including cheaper high sulphur heavy crudes, and has an overall Nelson complexity factor of 12.2.

“The refinery is capable of producing Euro-IV/Euro-V quality transportation fuel,” the statement said.

Once fully operational, the refinery will produce 700,000 tonnes of LPG, 200,000 tonnes of propylene a year, 3.8 million tonnes of petrol, 380,000 tonnes of ATF and 6.9 million tonnes of diesel. Paradip refinery will be IOC’s 8th refinery in the country and is expected to help the company scale up its refining capacity to 69.2 million tonnes from the current 54.2 million tonnes per annum, it said.

“The distillate yield from the refinery is expected to be best in class, with 81.1 per cent with no black oil production. Energy Intensity Index of Paradip Refinery is expected to be 78.6, which is in 1st quartile,” the statement read.

IOC said many new features at the refinery will ensure environment-friendly operation with minimum impact on the nature.

“Once successful at Paradip, IOC would establish itself in the international market for commercial use of this technology,” it said.

Paradip will be IOC’s 8th refinery in the country and is expected to help the company scale up its refining capacity to 69.2 million tonnes from the current 54.2 million tonnes per annum.

Asian refining margins- the difference between cost of crude and price of the finished product- have eased after touching multi year highs at the beginning of the year as regional demand is hit by slowing economic growth, especially in China.

“Today we got some naphtha, kerosene and gasoline,” said one of the sources.
India has nearly doubled its refining capacity over the last decade to almost 5 million barrels per day, making it the world’s fourth largest refining centre after the US, China and Russia, according to BP’s statistical review of world energy.

The Paradip refinery is the most sophisticated of IOC’s 11 plants. With the commissioning of Paradip refinery, IOC’s overall refining capacity has been increased to 1.61 million bpd, about 35 percent of the country’s 4.6 million bpd capacity.

Paradip refinery is expected to mainly cater to the markets in eastern India, currently fed by sourcing fuels from private players and other plants in northern India, and free up some gasoline for overseas markets.

Gasoline margins have remained strong in recent months even as margins for other products such as diesel, mostly used in construction, and shipping fuel, have weakened.