Essar Energy plc, the India-focused
integrated energy company, announced that Essar Oil Ltd. has
successfully commissioned diesel hydrotreater unit 1 (DHDT-1)
as part of the Phase I expansion at its Vadinar refinery in India.
Three units remain to be commissioned as part of the Phase I
expansion, which is firmly on track to be completed by the end
The Phase I project involves the addition of
nine new units and an expansion of the refinery's capacity to 18 million
metric tpy (or 375,000 bpd). The project will enhance the
refinerys complexity to 11.8 from 6.1.
With this commissioning, Essar Oils
capital expenditure program is beginning to taper down. The
refinery expansion will deliver a substantial
pickup in revenues and profitability for the company going
The DHDT-1 unit, which has a capacity of 4
million tpy, will upgrade diesel quality by treating the sour
diesel streams, thus achieving a sulfur content reduction along
with a higher cetane index for treated products.
The new unit will also ensure that Vadinar refinery diesel product meets Euro V
specifications, as required in the European Union since 2009. The
market for low-sulfur fuel is rapidly expanding, with 20 top Indian cities now requiring Euro
Essar Oil has already commissioned the new
isomerization unit at Vadinar. The first Phase I expansion will further enhance this
refinery to produce high-octane and near-zero-sulfur
L. K. Gupta, managing director and chief
executive officer of Essar Oil, said, "We have now
commissioned two key units that will help us produce diesel and
petrol conforming to international standards. We are very close
to delivering the scale that we had set out to achieve for the
Vadinar refinery. The increased complexity that we will have
post-expansion will give us greater flexibility to produce
higher-value fuels that have a growing market both in India and overseas."
Alongside the Phase I expansion, an additional optimization project is underway at the Vadinar
refinery, which will further increase capacity to 20 million
metric tpy (405,000 bpd) by September 2012.
The capacity expansion, complexity enhancement
and subsequent optimization will give the refinery the
capability to process over 80% heavy and ultra-heavy crudes,
which are lower in cost than light crudes.
In terms of product yield, the expanded Vadinar refinery will have the flexibility
to produce higher-value products, including petroleum