Essar Oil Ltd, flagship company of The Ruia Group is planning to continue the Vadinar Jamnagar Refinery expansion.
Essar Oil Ltd, confirmed yesterday its plans to go ahead with the expansion of its Jamnagar refinery and continuing business of petroleum retail businesses spread across the country.
The company is also laying down phased plan to expand into petrochemicals, the natural progression for any refinery, till after the second stage of refinery expansion is completed in December 2011.
This expansion project would cost about $5.5 billion, is being implemented in two phases for which the company has a loan commitment of about $4.55 billion, $700 million is from commitments in foreign loans and the remaining is from Indian lenders. Essar did mentioned that they can go for more foreign lending.
Current expansion plans are needed for Essar to de-bottleneck and upgrade its existing Jamnagar refinery, Essar is hoping to increase Jamnagar refinery's annual output capacity from 13 million tonnes (mt) to 16 mt (330,000 barrels a day) in the first phase. This phase will cost Rs 7,810 crore and it will involve installation of additional processing units (such as coker and hydro-treaters), a hydrogen-manufacturing unit and revamping of some of the existing units. The company is taking Rs 4,600-crore debt for the first phase, which is expected to be completed by December 31, 2010.