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Essar Oil says to raise imports from Latin America

Essar Oil says to raise imports from Latin America
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First Published: Mon, Jan 17 2011. 08 09 PM IST
Updated: Mon, Jan 17 2011. 08 09 PM IST
New Delhi: Essar Oil will step up crude oil imports from Latin America as it seeks to expand its Vadinar refinery in western Gujarat state by 43% by September 2012, its managing director said on Monday.
Essar plans to lift the capacity of its refinery from 280,000 barrels per day (bpd) to 360,000 bpd by end-June and to 400,000 bpd by September 2012.
“Apart from Middle East, which is of course a natural home for sourcing the crude, we will have to go to Latin America, which generally produces heavy category of crude,” Naresh Nayyar said in a conference call after Essar Oil’s quarterly results announcement.
Essar Oil refines 35% of light crude oil, out of its total oil processing. After expansion it aims to lift the share of heavy and ultra heavy grades to about 90% from about 65% now.
He said term crude oil imports account for about 40-45% of Essar’s oil processing.
Nayyar did not elaborate how much crude on average Essar buys from Latin America.
In October, Essar Oil said it was replacing imports of Latin American crude with local Mangla grade.
The company had been importing about 3 million barrels a month of crude oil from Iran, Nayyar said, adding his firm would continue to import the same volume.
The Reserve Bank of India (RBI) said last month payments for import from Iran could no longer be settled using a long-standing clearing house system run by regional central banks.
“We believe the issue will be resolved shortly. But there is no disturbances in terms of supplies from Iran,” Nayyar said.
He also said his firm was going ahead with plans to expand retail fuel stations to 1700 but further expansion to 3,000 depends on pace of deregulation of diesel.
In June, government ended its control on setting petrol prices and decided to eventually free diesel prices, without specifying any timeline.
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First Published: Mon, Jan 17 2011. 08 09 PM IST