Essar pipeline interconnection proposal with IOC approved

Essar pipeline interconnection proposal with IOC approved

Thursday, 20 March 2008, 07:00 Hrs
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New Delhi: Essar Oil's proposal seeking interconnection with the Indian Oil Corp's (IOC) Salaya-Mathura trunk crude oil pipeline at Vadinar in Gujarat has been approved by the government, a petroleum ministry official said.

Essar Oil had argued that the proposed interconnection would help to avoid possible disruption in crude supplies to their refineries at Vadinar, Panipat and Mathura through these pipelines if any offshore tanker-mooring buoy were to shut down.

Essar had first approached IOC with the proposal. But the state-owned company did not show much interest, saying it did not see any advantage in the pipeline interconnection, said Essar sources.

Essar was told that IOC was expanding the capacity of its Panipat refinery from 12 million metric tonnes per annum (MMTPA) to 15 MMTPA and that it cannot enter into any arrangement that entailed sharing capacity of the linked-crude pipeline with others, said Essar sources.

IOC also expressed apprehension that it might have to curtail crude supply to its own refinery in case Essar Oil's buoy was shut down, forcing it to divert its crude supply to the Essar pipeline.
Source: IANS
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