IOCL presses ‘restart’ on 64 projects worth Rs 21,375 cr

• Out of these 64 projects, work has commenced on 29 projects on April 20

• IOCL's LPG sale during April 1-20 was 696.6 thousand metric tonnes (TMT), up by over 19.6 percent compared to the same period last year

New Delhi: State-run IOCL (Indian Oil Corporation Ltd) has commenced resumption of stalled activities on 64 select projects which entail an investment of about Rs 21,375 crore. Out of these 64 projects, work has commenced on 29 projects on April 20 when lockdown restrictions were lifted partially.

The Ministry of Petroleum and Natural Gas had said in a tweet on April 20 that work had been resumed on 511 projects by oil and gas PSUs and that the projects are expected to generate 7 crore man-days of employment. These projects are worth approximately Rs 2 lakh crore.

IOCL resumes work on pipeline projects, LPG bottling plants, among others

Major projects on which work has resumed include the Rs 3,338-crore Paradip-Hyderabad products pipeline, which traverses 1,212-km through Odisha, Andhra Pradesh and Telangana; the Rs 3,028 crore augmentation of Paradip-Haldia-Durgapur LPG pipeline and its extension to Patna and Muzaffarpur, which traverses 678-km through Odisha, Jharkhand, West Bengal and Bihar; the Rs 6,025 crore Ennore-Tiruvallur-Bangalore-Pondicherry-Nagapattinam-Madurai-Tuticorin R-LNG pipeline, which traverses 1,170-km through Tamil Nadu, Andhra Pradesh, Puducherry and Karnataka.

IndianOil resumes construction of the Bitumen storage and bulk loading facilities in approx. 4.7 acres of land given by Barauni Refinery, post the #COVID19 lockdown. Estimated cost of the project is Rs. 67.31 crores. #StayHomeStaySafe #ProudToBeAnIOCian pic.twitter.com/QU9Pp6Lqgx

— Indian Oil Corp Ltd (@IndianOilcl) April 21, 2020

Work has also restarted on other projects like grassroots LPG bottling plants, bulk storage terminals/depots, city gas distribution projects and additional facilities/tankage at existing locations. The Corporation has recently completed a massive exercise of BS-VI fuel quality upgradation projects at all its refineries at a combined cost of Rs 17,000 crore.

IOCL sold 696.6 TMT LPG in April, plans to hike import by 50%

IOCL's LPG sale during April 1-20 was 696.6 thousand metric tonnes (TMT), up by over 19.6 percent compared to the same period last year. To meet this rise in demand, IOCL has tied up for additional LPG imports by almost 50 percent, and its 98 LPG bottling plants are working extended hours, operating night shifts and on public holidays/Sundays. With its LPG distribution channels, particularly the delivery staff working round-the-clock, IOCL teams have been delivering on an average 26 lakh cylinders every day to the doorsteps of customers in spite of the lockdown. Additionally, IOCL has ensured delivery of LPG cylinders to 1.1 crore families who are Pradhan Mantri Ujjwala Yojana beneficiaries, during this period.

CAPEX plans: 188 major projects worth over Rs 25 crore on the anvil

The Corporation's CAPEX plan for 2020-21 majorly includes projects in refineries, pipelines and marketing segments, followed by petrochemicals. Among these, there are 188 major projects above Rs 25 crore, which include some pipeline projects that were underway even during the lockdown period.

IOCL's CAPEX plans are based on long-term demand potential in the country. Over the long-term, India is expected to be one of the fastest growing oil and gas markets in the world and the current setback in demand is only temporary before the oil and gas demand growth in the country picks up again. These projects are crucial from the perspective of addressing future energy demands as well as employment generation. It said that global cues and the changing market scenario will guide its future strategy

IOCL on historic crude oil crash

Commenting on the sharp decline in crude oil prices, ultimately plunging WTI into a historic minus $37.63 a barrel level on April 20, IOCL said that it was a result of panic selling of May-20 delivery contracts a day before its expiry date, failing which the delivery would have been necessary amidst COVID-19 related demand destruction and the storage constraints at Cushing, Oklahoma. However, WTI futures for June-20 as well as ICE Brent for May-20 are still trading at around $16/bbl and $21/bbl, respectively.

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Telegram. Join PSU Watch Channel in your Telegram and stay updated)