New Delhi: Chennai Petroleum Corp is looking to expand the capacity of its refinery at Manali in southern India as environment-related issues halted its plan to build a new facility, a senior executive said on Friday.
Chennai Petroleum, majority owned by state-run Indian Oil Corp, accounts for six per cent of India's refining capacity with its 9.5-million-metric-ton-annually Manali refinery and one-million-tonne Nagapattinam unit, both in southern India. It is now looking to raise the capacity of the Manali unit by 6 million tonnes a year, Finance director N.C. Sridharan told reporters on the sidelines of an industry conference.
"We wanted to set up a nine-million-tonne greenfield refinery at Ennore, but there were some environmental issues," he said without elaborating on the issues. "So we are looking at brownfield expansion."
The company's plan to expand capacity comes at a time when worldwide demand for finished petroleum products is expected to rise after the economic downturn, and India is trying to become a global hub for oil refining as the country has lower capital costs. Indian Oil and other local refiners like Hindustan Petroleum Corp and Bharat Petroleum Corp are also setting up new refineries and expanding existing ones.
Sridharan said after the Ennore project was delayed, the government offered the company an alternative site at Cuddalore for the greenfield plant. However, that site was not viable for the project.
