- IOC aims to boost refining capacity by 30% over next 6 years
- Country’s capacity may reach 340 million tons by 2030: Singh
Indian Oil Corp. will spend about 400 billion rupees ($6 billion) to boost capacity by almost 30 percent in the next six years to feed the booming fuel demand in the world’s second-most populous nation.
“Fuel demand is rising and India’s excess capacity is very small,” Sanjiv Singh, director of refineries at India’s biggest processor, said in an interview Friday. “We all need to expand if demand sustains.”
The expansion comes as Indian refiners are racing to add capacity amid rising fuel consumption. India is poised to surpass Japan as the world’s third-largest oil user this year and will be the fastest-growing crude consumer in the world through 2040, Paris-based International Energy Agency estimates.
The state-run company aims to increase its capacity to about 104 million metric tons a year, or about 2 million barrels per day, over the next six years by expanding the existing refineries across the country, said Singh.
Indian Oil currently can process 80.7 million tons of crude a year from its nine plants and two owned by its unit Chennai Petroleum Corp., accounting for 35 percent of the nation’s total, according to its website.
India’s oil demand is forecast to reach 329 million tons by 2030, according to IEA. The country’s 23 refineries have a total capacity of 230 million tons a year, while total fuel demand was 183.5 million tons during the financial year that ended March 31, according to the oil ministry.
“In another 15 years, India should be adding another 100 million ton refining capacity,” Singh said. “By 2030, India would easily cross as much as 340 million-ton capacity.”
Separately, Indian Oil is working with the government as well as other refiners to build a 60-million-ton-a-year refinery on the west coast. The proposed project, which would include petrochemical units, may cost about 2 trillion rupees, Singh said.
They will build the refinery in two phases, with two crude units totaling 40 million tons in the first phase and a third one in the second phase, he said. “After getting possession of the land, it will take five to six years to complete the first phase,” he said.