CPCL advances construction of grassroots Cauvery Basin refinery

Update: In October 2021, Chennai Petroleum Corp. Ltd. (CPCL), a partly owned subsidiary of Indian Oil Corp. Ltd., let a contract to McDermott International Inc. to provide a suite of consultancy services for the grassroots 9-million tpy refinery at Cauvery Basin, in Panangudi Village, Nagapattinam District, Tamilnadu, India (OGJ Online, Oct. 18, 2021).

Indian Oil Corp. Ltd. has broken ground on subsidiary Chennai Petroleum Corp. Ltd.’s (CPCL) recently approved project to build a grassroots 9-million tonnes/year refinery at Cauvery Basin, in Panangudi Village, Nagapattinam District, Tamilnadu, India (OGJ Online, Feb. 2, 2021).

Shri Narendra Modi, India’s prime minister, laid the foundation stone of the planned refinery in a ceremony on Feb. 17, IOC and the Indian government said in separate releases.

Alongside initiating construction activities for the refinery, Modi also dedicated the recently commissioned  600,000-tpy FCC gasoline desulfurization unit at CPCL’s 10.5-million tpy Manali refinery in Tamil Nadu as part of the second phase of the operator’s Bharat Stage VI (BS VI, equivalent to Euro 6-quality standards) fuels project for production gasoline with less than 10 ppm sulfur in compliance with the Ministry of Petroleum & Natural Gas (MOPNG) of India’s directive of 100% production of BS VI-quality fuels for the country that took effect Apr. 1, 2020 (OGJ Online, Feb. 10, 2021).

The new 5-billion rupee FCC gasoline desulfurization unit actually will produce gasoline with less than 8 ppm sulfur, IOC said.

The Feb. 17 ceremony also additionally included Modi’s dedication of the 7-billion rupee, 143-km Ramanathapuram-Thoothukudi section of the larger 45-billion rupee Ennore-Thiruvallur-Bengaluru-Puducherry-Nagapattinam-Madurai-Tuticorin natural gas pipeline (ETBPNMTPL) that will transport gas from Oil and Natural Gas Corp. Ltd.’s (ONGC) fields as feedstock to Southern Petrochemical Industries Corp. Ltd. (SPIC) at Tuticorin and other industrial-commercial customers, according to the prime minister’s office.

The refinery and pipeline projects are intended to expand Tamilnadu’s oil and gas infrastructure as a part of India’s broader plan of reducing the country’s energy import dependence, Modi said.

Cauvery Basin refinery overview

Intended to help meet southern India’s demand for petroleum products, the planned Cauvery Basin project will involve dismantling of CPCL’s existing 1-million tpy refinery at the site—which ceased operations on Apr. 1, 2019—for the new construction, according to project documents from CPCL, the government of India, and Engineers India Ltd. (EIL), which completed a detailed feasibility report as well as carried out technology evaluation and process licensor selection for the project.

As currently proposed, the new refining and integrated petrochemical complex will include the following major units and capacities:

• Combined crude-vacuum distillation unit; 9 million tpy.
• Naphtha hydrotreating unit; 1.5 million tpy.
• Isomerization unit; 570,000 tpy.
• CCR unit; 625,000 tpy.
• Diesel hydrotreating unit; 5 million tpy.
• Vacuum gas oil hydrotreating unit; 3 million tpy.
• INDMAX FCC unit; 2.43 million tpy.
• INDMAX FCC gasoline hydrotreating (desulfurization) unit; 700,000 tpy.
• OCTAMAX unit; 125,000 tpy.
• Polypropylene unit; 475,000 tpy.
• Delayed coking unit; 2.5 million tpy.
• Hydrogen generation unit; 98,000 tpy.
• Sulfur recovery unit (SRU) with independent tail-gas treatment unit (TGTU), Train 1; 432 tonnes/day.
• SRU with independent TGTU, Train 2; 432 tonnes/day.

While CPCL currently is pursuing environmental approval for the greenfield complex, timelines for the project’s construction and targeted commissioning have yet to be determined, the operator said in its latest annual report to investors.

Start of construction on the refinery follows IOC’s approval for incorporation of a joint venture under which IOC (25%) and CPCL (25%) would hold a combined 50% equity interest for developing the project. Subject to statutory approvals, the remaining 50% interest in the new refinery JV would be held by outside financial, strategic, or public investors to be identified later, IOC said.