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Golden Steps towards Energizing India

Oil is of vast importance in the world today. A country that does not produce its own oil is in a weak position. From the point of view of defense, the absence of oil is a fatal weakness…”. These words by independent India's first Prime Minister Pandit Jawaharlal Nehru declared in Parliament on 26th May 1956 echoed the aspirations of a new paradigm in the oil industry.

At independence, in 1947, the country had just one small refinery of 0.5 MMTPA in Digboi commissioned in 1901 to process crude oil into petroleum products. Today the crude refining capacity has gone upto 179.47 million tonnes. As the nation's flagship company, IndianOil group owns and operates 10 of India's 20 refineries with a combined refining capacity of 62.7 million metric tonnes per annum (MMTPA).

Incorporated as Indian Oil Company Ltd on 30th June, 1959, the company was renamed as Indian Oil Corporation Ltd on 1st September, 1964 following the merger of Indian Refineries Ltd (established 1958) with it. In the 50 Golden years of its existence, IndianOil has grown manifold. From a fledgling company with a net worth of just Rs 45 crore and sales value of Rs 78 crore in the year 1965 to achieving gross turnover of Rs 2,71,074 crore (inclusive of excise duty) for the year 2009-10. The Profit After Tax (PAT) was Rs 10,221 crore.

Strongly driven by the highest ever sales of petroleum products and boosted by an increasing contribution from its Petrochemicals and Gas businesses, the nation’s largest corporate and its highest ranked Fortune ‘Global 500’ company, Indian Oil Corporation Ltd. (IndianOil) reported an excellent performance for the year 2009-10.
During the year 2009-10, in which the company celebrated its Golden Jubilee, IndianOil’s ranking improved from 116th to 105th in the prestigious Fortune Global 500 listing.

Despite the uncertain phase that the global economy went through, the Indian economy showed a resilience that was truly remarkable. While the overall petroleum products consumption in the country grew at 3.4% during the year, IndianOil managed to notch up a growth of 4.6% registering a sales volume of 63.7 million tonnes.

The Corporation’s refineries surpassed 100% capacity utilisation for the third consecutive year and clocked a throughput of 50.7 million tonnes. IndianOil’s pipelines network registered the highest ever operational throughput of 65 million tonnes of crude oil and petroleum products.

Nothing can better encapsulate the expanse, reach and depth of IndianOil than the words —“IndianOil in every heart, in every part.”
IndianOil operates the largest and the widest network of petrol & diesel stations in Asia with over 35,000 marketing touch points, located across different terrains and regions of the Indian sub-continent.

From the icy heights of the Himalayas to the sun-soaked shores of Kerala, from Kutch on India’s western tip to Kohima in the verdant North East. They are backed for supplies by 167 bulk storage terminals and depots, 101 aviation fuel stations and 89 Indane (LPG) bottling plants. About 7,335 bulk consumer pumps are also in operation for the convenience of large consumers, ensuring products and inventory at their doorstep. IndianOil reaches Indane cooking gas to the doorsteps of over 53 million households in nearly 2,700 markets through a network of about 5,000 Indane distributors.

Fuelling the Aviation sector, IndianOil’s ISO-9002 certified Aviation Service commands over 62% market share in aviation fuel business, meeting the fuel needs of domestic and international flag carriers, private airlines and the Indian Defence Services.

The ‘Kisan Seva Kendra’ is a unique retail outlet model pioneered by IndianOil to cater to the needs of the customers’ in the rural segment. Today IndianOil’s KSKs have emerged as a dominant player in the rural markets, riding on the rapid growth of upcoming second and third tier roads in the rural areas. This initiative has gone on to win awards from the Rural Marketing Association of India and the Asia Retail Congress.

IndianOil’s world-class R&D Centre is perhaps Asia’s finest. Besides pioneering work in lubricants formulation, refinery processes, pipeline transportation and alternative fuels, the Centre is also the nodal agency of the Indian hydrocarbon sector for ushering in Hydrogen fuel economy in the country. It has set up a commercial Hydrogen-CNG station at an IndianOil retail outlet in New Delhi this year. The Centre holds 214 active patents, including 113 international patents.

IndianOil has joined the league of global technology providers last year with the selection of its in-house developed INDMAX technology (for maximising LPG yield) for the 4 MMTPA Fluidised Catalytic Cracking (FCC) unit at the Corporation's upcoming 15 MMTPA grass roots refinery at Paradip in Orissa, as well as for the FCC unit coming up at Bongaigaon Refinery.

At the turn of the century, having consolidated its strengths in refining, marketing and transportation of petroleum products through pipelines, IndianOil’s soaring aspirations met with success as IndianOil strengthened its presence in exploration & production of oil, Petrochemicals and Natural Gas in addition to globalising the marketing operations.

With commitment to sustainable development, IndianOil is now, also engaged in widening its portfolio of energy offerings by exploring alternative energy sources such as wind, solar, hydrogen, and bio-fuels.

Today, IndianOil feels proud to have fulfilled the most significant role of providing the energy needed for economic development and thereby fuelling the dreams and aspiration of the people of India. Behind a billion satiated Indian customers are the relentless efforts of over 34,000 IndianOilPeople. Driving the nation's economic growth engine forward is the uninterrupted supply of the vital energy by IndianOil.

In the past few years, IndianOil’s business strategy has been to straddle the entire hydrocarbon value chain through integration and diversification initiatives. Despite the turmoil in the global economy in the recent past, IndianOil strode ahead as it consolidated its established business and entered into new ones.

IndianOil is currently investing over Rs 45,000 crore during XI Plan (2007-12) in augmenting refining and pipeline capacities, expanding marketing infrastructure and upgrading product quality as well as in integration and diversification projects. These will play significant role in providing impetus for achieving the competitive edge for greater productivity, competitive advantage and customer delight.
Turning every adversity into opportunities has been the hallmark of IndianOil. Even when the world was trying to recover from the aftermath of the economic recession, IndianOil Refineries, once again, have achieved overall capacity utilization at 102% during 2009-10. This is the third consecutive year of crossing the 100% capacity utilization mark despite planned revamp / M&I shut downs for implementation of quality up gradation projects in all the Refineries. In the fiscal year 2009-10, IndianOil Refineries achieved the highest combined distillate yield of 75.3 wt% while garnering a crude throughput of 50.7 Million Metric Tonnes.

With the committed energy efficiency management efforts, IndianOil Refineries achieved the lowest ever overall specific energy consumption of 62 MBN during 2009-10 against the earlier best of 64 MBN during 2008-09. It is noteworthy to mention that the lowest energy consumption achieved by IndianOil Refineries is better than the industry average of 64 MBN.

In line with Auto Fuel Policy, after successful completion and commissioning of the MS / HSD quality improvement projects at Panipat, Mathura and Haldia Refineries have started production and supply of Euro-IV grade Motor Spirit and High Speed Diesel. Implementations of Quality Improvement Projects at other Refineries is in full swing and are expected to be completed soon.
On the environment front, all IndianOil refineries fully comply with the statutory requirements. Under the Clean Development Mechanism (CDM) initiative, four projects, one each at Digboi, Haldia, Barauni and Gujarat Refineries have been registered with UNFCCC.

In the direction of alternate energy resources, IndianOil has also successfully installed and commissioned a Wind Power project of 21 MW capacities in kutch district of Gujarat this year to mark the beginning of renewable energy generation by the corporation. This project will reduce CO2 emissions to the extent of 34,700 MT/Yr.
Focusing on strengthening its petrochemicals business chain through the integration of core competencies, IndianOil has commissioned its first and India’s largest Naphtha Cracker Complex at Panipat built at a cost of Rs 14,439 crore in March 2010.
The commissioning time of 46 months for Panipat Naphtha Cracker, which went on-stream in March 2010, compares with Global standard for similar capacity plants and is ahead of average time taken by Indian Plants. The Naphtha Cracker plant will elevate IndianOil’s stature as a major petrochemicals player in the days ahead.

The Naphtha Cracker Unit at Panipat will produce 800 KTA of Ethylene and 665 KTA of Propylene, which will act as feed for downstream polymer units like Polypropylene Unit (600,000 MTPA), Linear Low Density/ High Density Polyethylene Swing Unit (350,000 MTPA), High Density Polyethylene unit (300,000 MTPA) and Mono Ethylene Glycol unit (300,000 MTPA). These polymer products will be used for manufacture of moulded plastic containers/barrels, heavy duty films, stretch wrap films, shopping bags, automobile parts, pipes and sheets, moulded furniture, Yarn & Fibre and many more household & industrial items.

The Naphtha Cracker at Panipat is a complex project comprising of above mentioned five process units along with other associated Units. To meet the utilities requirement a 239 MW Captive Power Plant; state-of-the-art Effluent Treatment Plant, three cooling towers of 144,000 M3/hr capacity, N2O2 Plant, Water Treatment Plant with capacity 5,600 M3/hr and ultra modern lab facilities for chemical and polymer testing have been set up. The entire Cracker Complex has around 2,925 equipments, 100 storage tanks, and involved around 1,600 KM of piping and 8,000 KM of cable laying. Around 119,000 MT of steel and 220,000 MT of cement have been consumed in the project.

During peak time, more than 5,000 engineers from India, Korea, Japan, Germany, Singapore, United States and other parts of the globe and around 40,000 workers toiled and worked efficiently for design, procurement and at site to create the success saga. More than 160 million accident free man hours have been completed in this project.

The Naphtha Cracker at Panipat is one of the mega projects being concurrently implemented by IndianOil. The other projects include Once-through Hydrocracker Unit (OHCU) at Haldia, Grassroots Refinery project at Paradip, capacity expansion projects at Panipat and Haldia and quality improvement projects of various size and configuration at all refineries.

In a historic milestone, IndianOil’s Haldia Refinery commissioned the prestigious Once-through Hydrocracker Unit (OHCU) Project during the year setting up a new benchmark in execution as well as commissioning. The shortest time span of 57 days from its Mechanical completion to commissioning is the best achieved by any refinery globally. Haldia Refinery also enhanced its crude processing capacity from 6 MMTPA to 7.5 MMTPA by successfully completing the revamp job. With the Capacity expansion at Panipat Refinery to 15 MMTPA heading towards its successful completion by October 2010, the refining capacity of IndianOil will go upto 54.2 MMTPA and group refining capacity will be 65.7 MMTPA.

In the backdrop of the growing energy requirements and formidable challenges in ensuring continuous operations in a competitive energy market, while ensuring sustainable development, IndianOil is further augmenting its refining capacity by setting up a 15 MMTPA refinery at Paradip at a cost of about Rs 29,777 crore. This is the largest investment of India’s leading ‘Fortune 500’ company on a single project. This highly complex and most modern refinery configured to process 100% heavy, high-sulphur cheaper crudes for better profitability is scheduled for commissioning by March 2012.

Considering the rising demand for energy to fuel the country’s growing economy, IndianOil plans to take the group refining capacity to 80.7 million tonnes per annum by the year 2011-12. At a time when the petroleum industry is moving towards new horizons, exploring new technologies, collaborating and developing symbiotic relationships to ensure secure, environment-friendly and affordable energy supplies, IndianOil too is surging ahead on the strengths of its core competencies in refining, pipelines and marketing and fortified by the new and emerging businesses to become a key global energy major and a globally admired company.

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