On a capex spree, IOC to invest `2 tn over 5-7 years: Chairman

Mumbai: National oil refiner and marketer Indian Oil plans to invest around Rs 2 trillion over the next five to seven years to expand the core petrochemical business and to ensure comprehensive energy solutions to the nation.

The company, which controls a third of the country's 5 million barrels a day oil refining capacity through its 11 refineries, is also entering newer areas like renewable energy, battery storage, city gas distribution, among others involving an investment of around Rs 2 trillion, chairman Sanjiv Singh told reporters here after the AGM.

For city gas city distribution alone, IOC will invest around Rs 10,000 crore over this period, he added.

"We have embarked on a robust capex plan of around Rs 2 trillion over the next five to seven years. This is much beyond the Rs 25,000-crore capex cycle that we have been planning for every year for quite some time now," Singh said, adding this will also include acquisitions.

He further said IOC will focus on consolidating its core business verticals, will continue to scale up new business verticals and at the same time gain entry into high growth potential areas to ensure inclusive and sustainable energy development."We are in the process of entering/expanding newer business areas. After the modification of our refineries to meet the BS-VI requirements, we are now expanding almost all the refineries. These include the expansion at Barauni, Gujarat and Panipat.

"Although we have not received the approval, we also want to expand the Paradip refinery," Singh said. He said since 1997, IOC has invested over Rs 25,000 crore each in major petrochemical projects in Gujarat, Panipat in Haryana and Paradip in Odisha refineries and is now investing over Rs 20,000 crore more on several ongoing and new petrochemical projects till 2023-24.

"We are not just focusing on brownfield expansion but we will also invest in greenfield expansion like the one planned through the West Coast Refinery and another one at Nagapattinam," Singh said.

"Apart from refining, we will require a matching pipelines for our growing marketing network. Also, there is a significant amount going into greener fuels. We are also exploring battery/energy storage, and a charging station vertical. This may include improving conventional battery storage or new forms of batteries. This will be beyond lithium-ion," he said. IOC is also going ahead with significant upstream investment, both domestic and overseas. "We have done a couple of fairly good acquisitions in the recent past and we are open to more such opportunities," Singh said.

On the West Coast Refinery project, Singh said the work is in progress and the final detailed project report is likely to be ready this year itself.

"After the agitations, the government has offered a new land parcel in Raigad district for the project. We had hired a consultant earlier to study the configuration of the project on the basis of the land at Nanar in Ratnagiri.

However, now we have now again hired a global consultant to verify and fine-tune the configuration," he said. Singh further said the government has already issued notices for land acquisition and is hopeful the actual process will start from this year itself.