refining company MRPL, a subsidiary of ONGC, will invest
Rs12,800 crore for upgrading its refinery at Mangalore
besides setting up an aromatics complex. The company''s
board has approved the investment and has sent it for
the consideration of parent company ONGC.
the upgrade, the refinery would be able to process heavy
and sour crude grades of crude leading to higher refining
margins. Heavy and sour crude oil prices are lower than
better grades like the NYMEX benchmark WTI or the Brent.
said the upgrade would also improve the distillate yield
by 11 per cent to 83 per cent of crude input. This would
reduce the quantity of low grade products, where realisations
are lower than the cost of crude.
upgrade would also help the company to produce high grade
diesel and petrol, conforming to higher emission standards
like Euro III and Euro IV. There is currently a shortage
of high grade fuel in the country and demand is expected
to go up in future as tougher emission standards are implemented.
Such products also enjoy good export demand.
also said the propylene capacity would go up to 300,000
tonnes per annum after the completion of the upgrade.
company would also set up a new aromatics complex within
the proposed special economic zone (SEZ) being promoted
jointly by MRPL. The complex would use naphtha feed from
the refinery and would have the capacity to produce 900,000
tonnes of paraxylene, a feedstock for PTA.
would also set up a facility for producing lubricant oil
base stock as a part of the refinery. The facility would
produce high end group II and group III base stock.
refinery upgrade programme is expected to be completed
within three-and-a-half years which would make MRPL the
second largest single location oil refinery in the country
after the Jamnagar refinery of Reliance Industries.
was initially promoted by the Aditya Birla group along
with PSU oil marketing companies. The company went through
some initial difficulties as the capacity was low at 3
million tonnes per annum.
Later, ONGC acquired a majority stake in the company by
buying out the Aditya Birla group and turned it around
by expanding capacity and achieving better efficiency.
is trading at Rs45.2 (up 4.27 per cent) at 11.00 AM on
the NSE today.