Essar Oil to double Vadinar refinery capacity to 20 million tonnes

Essar Oil Ltd, which is currently undertaking a major capacity expansion at its Vadinar refinery complex in Gujarat, plans to enhance its refining capacity by a further two million tonnes to reach 20 million tonnes per annum.

Phase I expansion of refinery capacity to 18 million tonnes is well on track and the current expansion plan is aimed at meeting the growing demand for petro products in India, the company said in a release.

Essar Oil currently operates a refinery in Vadinar with a capacity of 10.5 million tonnes per annum. The refinery, however, is consistently operating at a throughput of 14 million tonnes per annum, or 300,000 barrels per stream day.

As of 31 October 2010, the company has completed 72 per cent of Phase 1 expansion and is well on track for mechanical completion by March 2011, with the exception of two units that are delayed by a quarter, the release said.

The current expansion would take Essar Oil's refining capacity at the Vadinar refinery to 18 million tonnes per annum (or 375,000 barrels per stream day).

The company has now decided to further expand the refinery's capacity by 2 million tonnes to 20 million tonnes. This will be achieved through optimisation of some of the refinery units at an estimated cost of Rs1,700 crore ($380 million).