Gujarat Refinery scouts for more land in Vadodara

To acquire 25 acres near Koyali for its proposed projects.

Indian Oil Corporation (IOC)'s largest refinery at Koyali in Gujarat is bracing for a bigger role in the coming years.

The refinery, which was commissioned in 1965, is scouting for more land around the Koyali region to house its major proposed projects.

The refinery is close to acquiring 25 acres of land near Koyali and is in negotiations with land owners to acquire a large chunk of land to add to its existing facilities.

Confirming the development, UK Basu, executive director of Gujarat Refinery, said, "We are looking at new projects in the near future for Gujarat Refinery and are negotiating for more land to ensure flexible expansion."

The company has set up a committee for the purpose of land identification. Sources said initial talks also explored applying for an SEZ status for the newly-acquired land but the proposal was yet to be formalised.

The drive for acquiring more land comes at a time when the refinery is set to undertake two significant projects at its existing facility. These include setting up of a Rs 2,000-crore paraxylene plant for which in-principle approval has been received.

Paraxylene is the naphtha obtained from crude oil. Its primary commercial use is as feedstock for purified terephthalic acid (PTA), which is the main ingredient of polyester.

"The plant would cater to the growing demand of petrochemical products in India as well as markets abroad," said Basu.

The refinery will also undertake a residue upgradation and quality improvement project at a cost of Rs 5,693 crore. The project is expected to be commissioned in January 2010 and would process increased quantity of high sulphur crude among others.

The refinery raised its capacity from 12.50 million metric tonne per annum (mmtpa) to 13.70 mmtpa this year. Aviation turbine fuel (ATF), which currently makes up 2.5- 3 per cent of its production is being looked as a high growing product in the coming years considering the aviation boom.

IOC had recently signed a memorandum of understanding (MoU) with Ahmedabad-based Deep Industries, an oil and gas services company, for exploring the possibility of joint development of two CBM blocks, three marginal gas fields and marketing of gas.

Sources said the feasibility study for the joint collaboration undertaken recently was expected to be completed within six months.