Essar Oil on Friday announced the completion of the $1.81
billion expansion of its Vadinar refinery
with the successful commissioning of the final delayed coker
unit (DCU), which is amongst the world's largest.
The Vadinar refinery is now India's second largest
single-location refinery, with an annual capacity of 18 million
tonnes (375,000 bpd) and a complexity of 11.8, which also makes
it among the world's most complex refineries.
The capacity expansion and complexity enhancement
gives the Vadinar refinery the capability to process
much heavier crude diet, Essar says.
The share of ultra heavy crude, which currently constitute
20% of crude basket, will go up to 60%; and as a result the
overall share of heavy and ultra heavy crude will go up to 80%
of the refinery's total crude basket.
The company has already entered into long-term crude sourcing
contract with global suppliers, including several national oil
companies from Latin America.
In terms of product yield, the Vadinar refinery now has the
flexibility to produce higher value, high-quality products,
including gasoline (petrol) and gas oil (diesel) conforming to
Euro IV and Euro V norms, that have growing acceptance in both
domestic and international markets.
Close to 80% of its production will now be of valuable light
and middle distillates; and 50% of the production of gas oil
(diesel) and gasoline (petrol) will meet Euro IV and Euro V
specifications, Essar said.
Essar Oil says it is targeting newer markets such as
Australia, New Zealand and northwest Europe, in addition to
countries in the Indian subcontinent for exporting
However, Essar Oil will continue to market a majority of its
products in the domestic market, it said.
The Vadinar refinery benefits from a
fully-integrated infrastructure including India's only captive
coal-fired power plant (nearing completion) to provide power
and process steam, a port, pipelines and tankage, with
multi-modal product dispatch facilities through rail, road, and
sea, giving it a unique cost advantage.
"After starting commercial production just four years ago,
we are proud of achieving a size and scale that can match the
best in the world, said Naresh Nayyar, CEO of Essar
It underlines our commitment to building a
world-class, integrated, low-cost energy company that is
focused on India's energy growth story."
The Rs 8,300-crore project was implemented using the
companys in-house capabilities. Construction and overall project
management, for instance, was managed by Essar Projects, the firm said.
The DCU is a key addition to a modern refinery because of
its ability to convert bottom-of-the-barrel vacuum residue into
valuable products like gasoline (petrol), gas oil (diesel) and
VGO (vacuum gas oil).
It has a capacity of 7.5 million tpy and is licensed by
The DCU at the Vadinar refinery is not only among the
world's largest units of its kind but also one of the most
advanced to be used in any refinery worldwide, giving the
company a higher flexibility to process heavy and ultra heavy
crude and produce high-value products, the company said.
Alongside the expansion, an optimization project is also underway at the
Vadinar refinery that will further increase
capacity to 20 million tpy (405,000 bpd) by September 2012.