Chennai Petroleum Corp Ltd (CPCL), a subsidiary of IndianOil Corp Ltd, has got environment clearance for its Rs 3,350-crore expansion project at the Manali refinery near here.
Proposed two years ago, the project aims to maximise the refinery margins at least by $1 a barrel. It will produce more high value distillates and enable the company to process more of the cheaper high-sulphurous crude.
Company officials said the project would help process heavier, high sulphur crude, which is also cheaper. The distillate yield would go up by seven per cent and it would mostly be in the form of more petrol, diesel and liquefied petroleum gas.
The clearance has been delayed mainly because of a ban imposed by the Ministry of Environment and Forests (MoEF) on new expansion projects in the Manali industrial region. However, a study conducted in September 2011 had pointed out pollution levels had significantly dropped in the region, compared with previous years. The final DFR (draft final report) was completed in 2012 and the investment approval has been obtained.
Now, as the project got the ministry's clearance, it will take close to three years to finish the project, said company sources.
Total cost of the project, which was mentioned in the ministry's document, is now estimated at Rs 3,357 crore. When the project was announced, the company said it would attract an investment of Rs 3,100 crore.
The expansion project includes a coker unit (2.2 million tonnes per annum) and a sulfur recovery unit at the Manali Refinery Complex. CPCL is also proposing to set up a petroleum coke storage facility about 3.5 km from the refinery.
