Essar defers Vadinar refinery shutdown

Meanwhile the Essar Group has deferred a shutdown of its 280,000 barrels per day (bpd) domestic refinery to help out state-run customers who are running short on diesel with Japan's crisis and Middle East unrest spiking global prices and straining supplies.

In a statement yesterday, Essar Energy said its Vadinar refinery in western India would now shut for 35 days in September-October instead of an earlier May-June closure as per the request of state refiners that buy its products.

"Events in the Middle East and Japan have impacted the availability of petroleum products in the Asian region, particularly middle distillates such as gasoil," Essar chief executive, Naresh Nayyar said in the statement.

"We are working ... to ensure the continued availability of petroleum products during this period of tightness," he added.

State-run Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL) have already deferred their shutdown plans, and Indian Oil (IOC) has indicated its willingness to do so to meet local fuel demand.

According to Nayyar, the deferral would not impact the timing of its expansion of the refinery.

The Vadinar refinery shutdown is aimed at hiking capacity to 360,000 barrels per day (bpd) from around 280,000 bpd and adding to its capacity to process more ultra heavy and heavy crude oil as also to produce Euro V-compliant fuel for exports.

During the shutdown routine maintenance work would also be carried out at the facility.