Essar Energy plc (LSE:ESSR), the India-focused integrated energy company, today announced that it had received its first batch of domestic Mangala crude oil through a dedicated heated and insulated pipeline system from the oil fields in India’s western state of Rajasthan. This crude oil, one of India’s major oil discoveries, is supplied by a consortium led by Cairn India. It is a low sulphur, heavy and high pour crude, best refined in modern complex refineries such as Vadinar. This is an important event for Essar Energy as dedicated supplies from a domestic source will improve crude oil supply security and lower logistics costs and taxes. It also fits well with Essar’s strategy to diversify its portfolio of crude supply sources.
Mr Naresh Nayyar, CEO of Essar Energy said, “The crude oil supply from Mangala will ramp up over the next few weeks and is expected to account for around 10% of the total refinery intake. Being a heavy crude, Mangala will meet part of our increasing requirements for heavy and tough crude oils which should contribute positively to the refinery economics.”
The Vadinar refinery is located near the Vadinar Port in Gujarat, India and commenced commercial operations in May 2008. The refinery is a cracking refinery with a current capacity of 14mmtpa and an average Nelson complexity of 6.1, utilising fluid catalytic conversion as the refinery’s primary conversion technology. The refinery is currently undergoing a US$1.7 billion upgrade to expand capacity to 18mmtpa and increase the complexity to 11.8 with mechanical completion due in March 2011. The increased complexity will allow the refinery to increase the heavy and ultra heavy crude mix and also increase the output production of higher margin light and middle distillates. The result should be a sustained increase in the Gross Refining Margins.
For further information on Essar Energy, please visit www.essarenergy.com
For further information on the Essar Group, please visit www.essar.com
About Essar Energy
Essar Energy (LSE:ESSR) is a world class, low-cost, integrated energy company with an established track record.
More From This Section
Essar Energy is India’s second largest private power producer with 1,200MW of installed capacity and projects under planning and construction to expand its capacity to 6,100 MW in Phase I and 11,470 MW in Phase II.
Essar Energy is one of India's fastest growing private sector oil and gas companies with a diverse portfolio of exploration and production assets. The Vadinar refinery, located in Gujarat, is India's second largest private sector oil refinery with throughput capacity of 14mmtpa and plans to expand to 18mmtpa by March 2011.
About Essar Group
The Essar Group is a multinational conglomerate and a leading player in the sectors of Steel, Oil & Gas, Power, Communications, Shipping Ports & Logistics, Construction and Minerals. With operations in more than 20 countries across five continents, the Group employs 60,000 people, with revenues of USD 15 billion.