CPCL to put Rs 10,000 cr in Manali refinery expansion

Chennai Petroleum Corporation Limited (CPCL) has lined up an investment of around Rs 20,000 crore for the next five years for capacity expansion including a brownfield refinery project at Manali near Chennai with an outlay of Rs 10,000 crore, a top company official said.  

Speaking to reporters after attending CPCL’s annual general meeting here, IOCL chairman B M Bansal said that CPCL was planning to set up a 9 million tonne per annum (mtpa) brownfield refinery project at Manali to replace the ageing 2.8 million tonne refinery. The project is expected to be commissioned by the end of 2015, he added.

Projects worth Rs 2,000 crore already going on, said Bansal. Besides, CPCL has also taken up a resid upgradation project at an estimated cost of Rs 3,350 crore, which is expected to be complete by the end of 2013.

A new 42-inch crude oil pipeline to replace its existing 30-inch pipeline from the Chennai port to the Manali refinery at a cost of Rs 65 crore was also planned, he said.

CPCL managing director K Balachandran said the current gross refinery margin of $ 5-6 per barrel would enable the company to fund these projects through internal resources. The company's debt-equity ratio currently is around 0.8 and could be increased, Bansal said.