Seven more SBMs to dot Gujarat coast

Large oil importers like Reliance, Adani, Essar, Indian Oil Corporation (IOC), Bharat Oman Refinery among others are increasingly relying on bigger tankers to move their crude cargo to achieve economies of scale.

Gujarat is fast-emerging as a key location for companies for oil exploration and production.

In order to facilitate import through very large crude carriers (VLCC), several petroleum companies are now planning to install Single Bouy Mooring (SBM), a kind of unloading platform in the ocean (around 3-4 km off the coast) where oil tankers can unload their crude, which is then transpored to the coast through an under-sea pipeline and to the refinery through a land pipeline.

 

It is generally used in areas where the ports do not have sufficiently large enough draft to allow very large crude tankers to come in--if smaller tankers are used to carry crude, the costs rises dramatically.

Government officials say there will be an additional seven SBMs installed along Gujarat's coast. At present, seven SBM pipelines are already operational in the state.

Of these Reliance manages two at Sikka port and one at Hazira, Reliance has proposed to set up four more SBMs, which include three at Sikka and one at Hazira. Reliance plans to start one SBM at by the end of this month.

The company is investing close to Rs 1200 crore in Sikka and Rs 300 crore at Hazira. The handling capacity of the crude oil per SBM pipeline is around 10 million tonnes per anum (mtpa)--the current handling capacity is 40 to 50 mtpa of crude.

Adani group has one SBM at Mundra port. The Ahmedabad-based group has proposed two more SBM projects, which is estimated to cost around Rs.1000 crores.

Among the other existing SBMs, two are set up by IOC and one is being operated by Essar. Bharat Oman Refinery too has proposed to set up one at Vadinar with an investment of Rs.500 crores. The proposed SBM projects are expected to be completed within 4 to 5 years.