Indian Oil Corp firms up on raising refinery operations to 60% capacity

Indian Oil Corporation (IOCL) gained 0.86% to Rs 76 after the company said it has re-started several process units at its refineries that were down due to the lockdown.

The company stated on Monday (11 May) that the refineries are currently operating at about 60% of their design capacities with plans to scale up to 80% of the design levels by the end of the month.

The company said it has resumed manufacturing of petrochemical intermediates like HDPE (high-density polyethylene) and Polypropylene at its Panipat complex. With the demand for these grades likely to increase even further in the coming days, the Naphtha Cracker as well as the MEG (Mono-ethylene-glycol) plant at Panipat are back in operation. The Polypropylene plant at Paradip too will resume operations in a couple of days and other polymer units are also being readied to go online this month itself, the company added. Revival of the Panipat Naphtha cracker will also facilitate further increase in refinery crude oil throughputs.

IOCL further said that its Naphtha Cracker at Panipat was primed to operate well over its design capacity in March 2020 but had to reduce throughput substantially due to a build-up in polymer product stocks as well as logistics issues in the wake of the lockdown. With the gradual lifting in lockdown restrictions, several downstream industries in the plastics packaging, medical supplies and food packaging sectors have resumed operations from late April 2020. As a consequence, dispatches of polymer grades such as BOPP, GPBM, PP raffia and PP yarn used in these industries have begun from Panipat.

As of 31 March 2020, the Government of India held a 51.5% stake in IOCL while ONGC held a 14.2% stake in the company.

IOCL's segments include sale of petroleum products, sale of petrochemicals and other businesses. Its other businesses segment includes sale of gas, explosives and cryogenics, wind mill and solar power generation, and oil and gas exploration activities.

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