Haryana green signal for Panipat expansion

Vol 6, PW 2 (27 Mar 02) Midstream & Downstream

LOOK TO HARYANA for the reason why IOC has so abruptly decided to convert Kandla-Bhatinda into a crude only pipeline.

On 21st March IOC chairman Mohammad Pathan confirmed IOC has at last received the all important 'green signal' from authorities in Haryana to double capacity at the 6m t/y Panipat refinery. "Last week we met the Haryana chief minister and came to a final understanding," said Pathan.

"They have agreed to exempt the capacity expansion from the local area development tax." Imposition of this tax was the main stumbling block to a deal. Pathan said IOC will now implement the project in 30 months against the usual 36 months.

When IOC decided on expansion in 1999 the project cost was Rs3,365cr ($701m). This later rose to Rs4,165cr ($867m) last August to incorporate changes to produce cleaner fuel.

Originally IOC wanted the expanded refinery to process 6m t/y Arab Mix crude, but it will now be able to process low sulphur light crude also. Initial plans were to bring in crude through its Salaya-Mathura crude pipeline and in May 2000 IOC's board approved a proposal to hike capacity at a cost of Rs1,734cr ($361m) only to abort the idea later and convert its Kandla-Bhatinda products pipeline into a crude carrier instead.

This is how IOC now plans to implement the Panipat expansion project: Use Mundra port in Gujarat to receive crude Lay a 28-inch pipeline from Mundra to Kandla Convert the Kandla-Panipat section of the Kandla-Bhatinda pipeline into a crude carrier Extend the Koyali-Viramgam-Sidhpur product pipeline by a 16-inch, 506 km pipeline to Sanganer and provide a connection with the Kot-Salawas branch line at Kot and a delivery facility at Sanganer Lay a 12-inch, 160-km product pipeline from Panipat to Rewari