Essar Energy delays planned shut-down at Vadinar Refinery in India

Source: Essar Energy

Essar Energy (LSE: ESSR) will defer its 35 day planned shut down at the Vadinar refinery in Gujarat, originally planned for May and June 2011. 

This decision has been made following requests from Essar Energy's major public sector customers, Bharat Petroleum Corporation Ltd, Hindustan Petroleum Corporation Ltd and Indian Oil Corporation Ltd to continue production due to tightness in Asian markets for petroleum products, particularly gasoil, following recent events in the Middle East and Japan

The planned shutdown will be deferred until September and October 2011, after the monsoon season, but will not impact the schedule for the commissioning of the Vadinar phase I refinery expansion. Ramp up of the new units will commence in Q3 2011 with the majority of the increased production expected from mid Q4 2011. 

The planned 35 day shutdown is being undertaken to integrate and synchronize the existing refinery with the new units associated with the Vadinar phase I refinery expansion. This expansion will increase capacity to 375,000 barrels per stream day from around 300,000 currently and more importantly, increase complexity from 6.1 to 11.8. This will allow the refinery to process a greater proportion of ultra heavy and heavy crude oils, and to produce high grade Euro V fuels which can be sold into international markets. During the shutdown, Essar Energy will also carry out its routine maintenance schedule at the refinery. 

Mr Naresh Nayyar, Chief Executive of Essar Energy said: "Events in the Middle East and Japan have impacted the availability of petroleum products in the Asia region, particularly middle distillates such as gasoil. We are working with our customers to ensure the continued availability of petroleum products during this period of tightness. This will not impact the timing of our Phase I refinery expansion."

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