State-run oil refiner Indian Oil Corporation (IndianOil) plans to upgrade itself to process heavier crude.
In the first phase of its expansion plan, the company invested substantially to process high sulphur crude. In the second phase, it is looking at upgrading itself to process heavier crude, reports indicate. In the 12th five-year plan, the company has planned an investment of Rs 56,000 crore in the existing refineries.
The company plans to depend on borrowing, which stood at Rs 95,136 crore as on December 31, 2012, to meet the investment plan.
IndianOil, which operates eight standalone refineries, processes 10-11 per cent of heavy crude and wants this to rise to 30 per cent of total crude basket in the next three-four years.
The company feels that there is constant need to invest in refinery upgradation to help turn heavier and cheaper crude into fuel.
Sulphur content in crude oil is a key determinant of quality and is measured as a per cent of weight. Crude oil grades that are high in sulphur are referred to as sour crude, and those that are low in sulphur are referred to as sweet crude. The higher sulphur content affects the quality of the resulting refined products and sometimes means extra processing is required.
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