Commodity trader Trafigura has invested $130 million (€99 million) into Nagarjuna Oil’s refinery which is being built in Cuddalore in the state of Tamil Nadu, India.
Adding to this, the company will invest another $120 million into building petrochemical storage facilities on the 2,500 acre site.
The refinery is thought to be the first investment of this kind for Trafigura and it hopes that it will add value to its customers’ supply chains.
The facility is positioned in an area which will enable it to receive crude oil from Trafigura’s international producer partners.
The oil company will operate the refinery, which is to have a yearly capacity of 6 million tonnes. Processing heavy and sour grades of crude oil, the refinery will produce light and middle distillates up to European IV standards.
The facility can receive VLCCs at a single point mooring. Commissioning work is expected to begin this year with commercial operations coming online at the beginning of 2013.
Mr Jonathan Pegler, director of oil Asia Pacific at Trafigura, says: ‘India is fast emerging as a leading hub for oil refining, with domestic demand rising and an increasing trend towards cleaner refined products. In this context, the NOCL Refinery agreement represents a significant development for us. It also has the support of the Tamil Nadu State Government, which is committed to developing the region’s petrochemical infrastructure. Once fully operational, the refinery will greatly improve the supply of oil products to local retailers.’