Indian Oil Corporation, country's largest oil firm, plans to invest about Rs 190 crore (Rs 1.9 billion) in laying a pipeline from Panipat to Jalandhar to move LPG from its Panipat refinery, whose capacity is being expanded to 12 million tonnes-a-year this month.
"The 275-km pipeline is being built at a cost of Rs 186.72 crore (Rs 1.86 billion) with foreign exchange component of Rs 60.3 crore (Rs 603 million)," a company official said.
IOC has LPG bottling plants at Karnal (Kohand) and Gurgaon in Haryana, Jalandhar and Nabha in Punjab, Una and Baddi in Himachal Pradesh and at Jammu and Leh in Jammu and Kashmir. The LPG requirement of these bottling plants is presently met from Panipat refinery as well as from Loni tap off point, which receives LPG through GAIL's Jamanagar-Loni LPG pipeline.
The LPG to all the above plants, except Karnal plant, is presently transported by road. Karnal LPG bottling plant, which is about 7 km from Panipat Refinery at Kohand, receives LPG from Panipat refinery through a pipeline.
Considering the projected volumes, it would be advantageous to move this LPG requirement through a pipeline due to inherent disadvantages in road and rail transportation like high cost of transportation, safety and pollution risks, high energy consumption and low dependability, the official said.
At present, LPG from Panipat Refinery is being transferred through a 7-km pipeline to IOC's Kohand bottling plant. After meeting its requirement, the balance LPG is dispatched to other bottling plants in Nabha, Jalandhar and Jammu by road tankers.
The official said IOC board has already approved a detailed feasibility report on further capacity expansion to 15 million tonnes per annum by March 2008.
"In addition, residue fluidised catalytic cracking revamp project at Panipat refinery is already under implementation. IOC is installing naphtha cracker at Panipat. With these expansions in capacity and other projects, availability of products, including LPG at Panipat refinery, would increase substantially," he said.Do you want to discuss stock tips? Do you know a hot one? Join the Stock Market Investments Discussion Group