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IOC, NOC in marketing agreement

BS Reporter  |  Chennai 

Indian Oil Corporation (IOC) has entered into a marketing arrangement for selling petroleum products of Chennai based Nagarjuna Oil Corporation Ltd (NOCL), which is setting up a Rs 10,000-crore refinery in Tamil Nadu. The marketing arrangement would pave the way for bridging the current deficit in supplies of petrol, diesel and LPG in Tamil Nadu.

This deficit of around 3 million tonne is currently being met by bringing in products from the West Coast Refineries, with higher transport costs, resulting in higher retail prices for Tamil Nadu consumers, according to the company’s press release. NOCL’s refinery is designed to produce around 2.7 million tonne of diesel, 0.8 million ton of petrol, and 0.7 million tons of LPG, which would be sufficient to bridge this deficit.

NOCL’s refinery is also capable of producing BS-IV grades of petrol and diesel, which is mandatory in Chennai and Puducherry markets.

The 6-million tonne per annum petroleum refinery project of NOCL is coming up at Cuddalore, about 200 kms south of Chennai, Tamil Nadu. NOCL is jointly promoted by TIDCO of the Tamil Nadu government and the Nagarjuna Group of Hyderabad.

The Tata Group and Trafigura of Europe are the other major shareholders in NOCL. At an estimated cost of nearly Rs 10,000 crore, NOCL’s refinery project is the single-largest private sector investment in Tamil Nadu.

First Published: Mon, April 23 2012. 00:30 IST