Indian Oil selects provider for new unit at Panipat refinery

Indian Oil Corp. Ltd. (IOC) has awarded a letter of acceptance (LOA) to Linde India Ltd. to set up a new unit as part of the operator’s project to expand crude oil processing capacity and petrochemical production at its 15-million tonne/year (tpy) integrated Panipat refining and chemical complex in Haryana, India, north of New Delhi.

Under terms of the LOA dated Aug. 22, Linde India has agreed to build and operate a new air separation unit (ASU) that will produce and deliver instrument air, plant air, and cryogenic nitrogen to support IOC’s Panipat refinery expansion (P-25) project, the service provider said in a regulatory filings to BSE Ltd. and the National Stock Exchange of India Ltd.

After completing construction and performance testing of the ASU, Linde India said it plans to enter additional agreements with IOC that will allow the service provider to operate and maintain the unit for a period of 20 years following the ASU’s first delivery of industrial gases to the refinery.

Linde India said it expects to self-fund the proposed ASU plant using its own capital.

A timeframe for completion of the new unit and signing of operating agreements with IOC was not revealed.

This latest preliminary agreement for work on the P-25 project follows IOC’s July award of a contract to thyssenkrupp AG’s thyssenkrupp Industrial Solutions (India) Private Ltd. (tkIS) for delivery of engineering, procurement, and construction (EPC) of a 60,000-tpy polybutadiene rubber (PBR) plant to be included as part of the expansion (OGJ Online, July 31, 2023).

Alongside supporting IOC’s ongoing program of establishing a more robust petrochemical presence, the P-25 project will increase crude processing capacity of the Panipat refinery by 10 million tpy to 25 million tpy (OGJ Online, May 24, 2023).

Designed to improve operational flexibility of the refinery to help meet domestic energy demand, the P-25 project—which includes installation of a polypropylene unit—would also increase production of petrochemicals and value-added specialty products to elevate margins and derisk IOC’s companywide exposure to its conventional fuel business via addition of new units at the integrated olefins and aromatics complex (OGJ Online, Sept. 8, 2022).

Budgeted at an estimated cost of 329.46-billion rupees, the Panipat capacity expansion remains scheduled for commissioning by September 2024, the government of India said in June.