In a bid to further strengthen its Liquefied Natural Gas (LNG) operations, Indian Oil Corp, the largest public sector fuel retailer, plans to set up another LNG terminal on the country's eastern coast, it said in its annual report published on Monday.
"To meet the gas requirement of upcoming Paradip refinery, and other potential customers, setting up an LNG terminal is under consideration at East Coast in near future," according to the annual report. IOC's flagship 15 million tonne per annum (MTPA) Paradip refinery is at the cusp of commissioning.
The state-owned oil major is currently setting up its maiden 5 MTPA LNG terminal at Ennore near Chennai for import, storage and regasification of LNG. The terminal which is being developed at cost of around Rs 4,500 crore is targeted to complete by 2015-16.
"Steps have been initiated to have a significant share in the country's gas infrastructure through participation in upcoming gas pipelines (in JVs) and planned import storage and degasification terminal of 5 MTPA LNG with provision for future expansion to 10 MTPA at Ennore," the company said.
Apart from this, the company has marketing rights for 30% quantity of the LNG procured by Petronet LNG from RasGas on long term basis at Dahej besides long term contract at Kochi. IOC would be able to get its 30% offtake from Dahej terminal from 2016-17, upon expansion of this terminal from 10 MTPA to 15 MTPA. The fuel retailers total sales of regassified LNG and LNG was 3.219 MT, while its total LNG sales recorded growth of 18.1%
The company has also renewed its focus on Liquified Petroleum Gas (LPG) pipelines. LPG is a by product of petroleum refining. "With increased LPG imports and significant evacuation through tankers, LPG pipelines are the next growth avenue. Paradip-Haldia-Durgapur Pipeline and Ennore-Trichy-Madurai Pipeline are being planned for transportation of LPG," IOC said, adding that it plans to invest Rs 1,200 crore during current fiscal for implementing these various pipeline projects.
IOC wants to further increase its market share during 2014-15 by commissioning more number of LPG distributorships. Share of Domestic LPG during 2013-14 has increased by 0.35% from previous year. As on March, it had LPG bottling capacity of 7170,000 tonne per annum with 7035 LPG distributors.
The company also reiterated its plans to set up a refinery on the west coast which would be directly competing Reliance Industries' Jamnagar refinery. "Looking ahead the supply-demand evolution of petroleum products in the country throws up an opportunity to set up one such refinery on the west coast," it said. The refiner looks at Mundra Port to set up the refinery.
The upcoming Paradip refinery will provide IOC a capability to process heavy and high sulphur crude oil varieties along with the capability to produce futuristic Euro-V standard fuels. A major constraint in the current refining infrastructure of the company is the lack of a refinery on the west coast.