Petrochemicals Indian Oil to Expand Cracker Capacity in Panipat

Editor: Dr. Jörg Kempf

Indian Oil plans to expand capacity at its naphtha cracker in Panipat. The expansion would increase capacity of the cracker in northern India from about 850,000 tpy to 1.2 million tonnes per year (tpy) by 2019.

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Singapore – The cracker produces petrochemicals such as ethylene and propylene, the building blocks for plastics or polymers. Expansion costs total about half a billion dollars, S Mitra, the executive director of the refiner's petrochemical division, told Reuters during a condensate and naphtha forum in Singapore.

“Demand in (India) for polymers is growing,” said Mitra, adding that about 90 percent of the polymers that IOC produces is for domestic consumption. But it is unlikely that IOC would be building a brand new naphtha cracker in India in the short-term because of the challenges it faces in obtaining naphtha from one single refinery, he said.

The Panipat cracker currently needs over 2 million tonnes of naphtha feedstock a year and takes it naphtha from a few nearby refineries, including IOC’s own Mathura and Haldia plants. This will continue after the cracker's expansion.

IOC, India’s top refiner by capacity, exports an average of 800,000 tonnes of naphtha a year through various ports including Dahej, Chennai and Haldia. Its new 300,000 barrels-per-day (bpd) Paradip refinery will not have any surplus naphtha for sale as it is built to maximise output of gasoline at about 3.5 million tonnes a year (81,000 bpd), Mitra said.

India exports about 6 to 7 million tonnes of naphtha a year currently, said Mitra. In total it has more than 200 million tonnes of refining capacity and consumes over 160 million tonnes of oil products. (Source: Reuters)

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