Praxair Inc. has received a major order from the Indian Oil Corporation Ltd. for the long-term supply of hydrogen & nitrogen gases to its new greenfield oil refinery, currently being built on India’s eastern coast.

The 300,000 barrels per day (bpd) refinery is under construction at Paradip, Orissa and Praxair is to build both a 90 million standard cubic feet per day hydrogen plant and a 500 tons per day (tpd) nitrogen plant at the refinery.

Start-ups of the plants are scheduled for the first quarter of 2012, when the refinery will be commissioned.

IndianOil’s refinery will use the hydrogen to enable the processing of various crude oil slates and the production of low sulphur, clean fuels.

“This business agreement with Praxair is consistent with IndianOil’s strategy to outsource non-core operations to experienced global partners who can bring value to our refinery projects through their operational expertise,” explained IndianOil’s Director (Refineries) B.N. Bankapur.

“IndianOil selected Praxair after a global competitive bidding process and we are confident that Praxair, with its long experience in supporting the refining industry, will provide us with safe, reliable and efficient operations.”

Joe Cappello, President of Praxair Asia, added enthusiastically, “We are delighted to be partnering with IndianOil on its new, prestigious refinery project at Paradip.”

“Using state-of-the-art technology, Praxair is committed to playing a significant role in helping the refining industry globally to meet increasingly stringent environmental regulations for transportation fuels today and in the future.”

Burgeoning energy demands
IndianOil is augmenting its existing refining capacity by setting up the 300,000 bpd refinery at Paradip at a cost of around $6.5bn.

It’s thought that this will help meet the burgeoning energy demands of primarily the Indian domestic market and partly the South-East Asian export market expected in the near future. It also represents the largest investment of India’s leading Fortune 500 company on a single project.

The new refinery is designed to process lower-cost high-sulphur and heavy crude oil. With the completion of the Paradip refinery and other capacity expansions, IndianOil’s refining capacity, including subsidiaries, will increase to more than 1.62 million bpd by 2011-12 from its current 1.2 million bpd.

The Indian Oil Corporation Ltd. is India’s flagship national oil company and its downstream petroleum major, as well as being the country’s largest commercial enterprise with more than $60bn in annual sales.

Praxair India meanwhile, with headquarters in Bangalore, is a wholly owned subsidiary of Praxair, Inc. and started operations in India in 1996.