IOC plans Rs 43500 cr expansion

Largest commercial enterprise Indian Oil Corporation Ltd (IOC) will invest over Rs 43,500 crore over the next five years, for capacity expansion, de-bottlenecking and quality upgradation. Of that amount Rs 30,000 crore will go into downstream integration as the company forays into the petrochemicals business it is also looking to acquire oil producing blocks, Chairman Sarthak Bahuria told journalists on the sidelines of the company’s 48th annual general meeting in Mumbai today. “We are planning an annual capex of Rs 7000-8000 crore in the next five years. A majority of the investment will be funded through internal accruals and borrowings as our financial health is quite good. If required, we may think of raising funds from the capital market, not in the next one or two years, but after that,” Bahuria said. The government-owned company controls 10 of India’s 19 refineries and accounts for 40.4 per cent share of national refining capacity. It has 60.2 million metric tonnes per annum (mmtpa) refining capacity. Apart from its current Panipat and Koyali petrochemicals projects, IOC plans to develop world class petrochemicals production centres at Paradip, Haldia and Chennai. Open to partners The 15 million metric tonnes per annum (MMTPA) grassroots refinery coming up at Paradip will be integrated with petrochemicals units for paraxylene, propylene and styrene with an investment of over Rs 26,000 crore. “IOC is actively pursuing upstream integration through exploration and production activities both within and outside the country,” the chairman said. Behuria said that the Rs 14,500 crore naptha cracker project in Panipat, Haryana, is scheduled to be commissioned in 2009. IOC would like to have partners in this project but has not been able to rope in any so far. “We are open to have a partner in the project, but we are not wasting time in finding out partners,” he said, when asked whether the company was looking at a partnership with Mittals.