Ioc To Build 3 Lube Plants

Indian Oil Corporation, (IOC), the country's largest refiner, plans to invest around Rs 170 crore in building three lube blending plants in three different states.

Two of the three plants will come up within the next 18 months while the third one will commence production only after 1999-2,000 AD.

One speciality lube plant, with a capacity of 30,000 tonnes, will come up at Taloja, Maharashtra, to cater to the high-end of the market.

The second plant at Silvassa, Gujarat, will also have an installed capacity of 30,000 tonnes, and is estimated to cost between Rs 45-50 crore.

The IOC board met last month to finalise the details of the Silvassa plant. The first phase of the Silvassa unit is expected to be commissioned by March 1998 to take advantage of the sales and income tax benefits provided by the union territory.

 

Benefits like a 10-year exemption from sales tax of 18 per cent and income tax relief for 15 years will lapse if the plant is not commissioned by March 1998. IOC sources said the bulk blending facilities will be commissioned first to avail of the tax benefits.

IOC has also begun feasibility studies on the third large lube blending plant in Haryana with a capacity of 60,000 tonnes. This project is expected to cost around Rs 90 crore.

Top IOC officials in the lube marketing division said a final decision on the third plant will be taken only after the feasibility studies are completed.

The proposed plants will be in addition to IOC's three blending plants at Mumbai, Calcutta and Chennai. The Corporation also has a grease unit at Vashi, Navi Mumbai. Currently, IOC has a total capacity of 3,65,000 tonnes excluding the Vashi unit. The Chennai unit produces 1,40,000 tonnes followed by Mumbai with 1,35,000 tonnes and Calcutta with 90,000 tonnes. By 2,000 AD, the company's total capacity will rise to 5.05 lakh tonnes.

"The new expansions will not only take care of our growth but also the market growth. In 1996-97, our lube sales grew by 3.5 per cent," said IOC sources.