The Indian Oil Corporation (IOC's) subsidiary Chennai Petroleum Corporation Ltd (CPCL) is planning to invest about Rs 760 crore in the current fiscal year.
Major part of the investment would go towards the company's resid project which is awaiting environmental clearance. The total cost of the upgradation project is estimated to be around Rs 3000 crore.
A S Basu, managing director, CPCL said that 50% of the Rs 730-760 crore would go for resid project and crude oil pipeline project connecting Chennai port with company's refinery at Manali, north of Chennai.
He added, the resid project was supposed to go on stream end of 2013, but it will be delayed. "From the time we get environment clearance, it will take 30 months to commission the project".
The project will help the company to improve its gross refinery margin (GRM) by $1-2 per barrel, said D Lilly, director - finance, CPCL.
Asked whether the delay will increase the cost of the project, Lilly said, "it (escalation) may not be their now since economic slow down still continues".