IndianOil zeroes in on Gujarat for new refinery

Vol 15, PW 11 (01 Dec 11) Midstream & Downstream

In public IndianOil officials are reluctant to say whether Maharashtra or Gujarat will be chosen as the location for a proposed new 15m t/y refinery on India’s west coast.

But in private a company source tells PETROWATCH Gujarat is leading the race. “We have zeroed in on Gujarat for the project,” he says.

IOC, adds our source, is likely to choose a location along the Saurashtra-Kutch coastline in western Gujarat, or at Dahej on the state’s southern coast. Saurashtra-Kutch is already home to two of India’s largest refineries, both operated by private sector companies: Mukesh Ambani-controlled Reliance’s 60m t/y Moti Khavdi refinery in Jamnagar district and Essar’s 14m t/y refinery at Vadinar.

IOC also has its 13.7m t/y Koyali refinery in Gujarat, located near Vadodara city. Why choose Gujarat over Maharashtra, India’s richest state “IOC already has strong tank and pipeline infrastructure in Gujarat,” we hear.

“All of IOC’s other refineries are landlocked so it makes sense to build a new refinery on the coast.” Imported crude oil destined for IOC’s three largest refineries at Koyali, Panipat and Mathura lands at Salaya Port near Vadinar in Gujarat, served by two ‘single point mooring’ (SPM) systems that IOC uses to unload crude received in tankers.

This crude is then transported from Salaya to its 15m t/y Panipat refinery in Haryana and its 8m t/y Mathura refinery through an 1870-km pipeline, which also supplies IOC’s Koyali refinery. IOC further supplies crude to Panipat through a 1194-km pipeline from Mundra, where it uses Adani Energy’s SPM.

At a press conference at Koyali on November 16, IOC director (refineries) RK Ghosh confirmed it is planning a west coast refinery, but cautiously chose not to comment on whether it would be in Gujarat or Maharashtra. “We are working on site selection and the cost,” he said.

“We will take a formal decision soon.”