Indian Oil plans $4.5 billion Panipat refinery expansion by Sept 2024

An Indian Oil tanker driver waits outside a fuel depot in Mumbai, India, October 6, 2017. REUTERS/ Danish Siddiqui/Files

NEW DELHI (Reuters) - Indian Oil Corp will invest 329.46 billion rupees ($4.46 billion) to raise the capacity of its Panipat refinery by two-thirds to 500,000 barrels per day (bpd) by September 2024, the country’s top refiner said on Friday.

India, the world’s third biggest oil importer and consumer, aims to expand its 5 million bpd refining capacity by 60% to meet rising local demand as Prime Minister Narendra Modi seeks to boost the manufacturing sector.

Along with expanding capacity, IOC will install catalytic dewaxing and polypropylene units at its Panipat refinery in northern Punjab state, it said in a statement.

In 2018 IOC announced capacity expansion of the 300,000 bpd Panipat refinery costing 231 billion rupees. At that time it did not announce plans to set up the two other units.

IOC said expansion of the refinery would raise production of petrochemicals and value-added specialty products to improve its margins and help “de-risk the conventional fuel business of the company”.

To meet India’s growing energy demand, oil minister Dharmendra Pradhan is seeking 175 acres of land in eastern West Bengal state for expansion of IOC’s 160,000-bpd Haldia refinery, IOC said.

IOC along with its subsidiary Chennai Petroleum Corp Ltd, has a total installed refining capacity of 1.6 million bpd.

($1 = 73.8850 Indian rupees)

Reporting by Nidhi Verma; editing by Jason Neely