Union Petroleum Minister Dharmendra Pradhan on Tuesday formally launched the Rs 3,110 crore residue upgradation project of IndianOil Group company, Chennai Petroleum Corporation ltd, here.

The city-based Chennai Petroleum Corporation embarked on value addition at the Manali refinery near the city, for upgradation of residue to high value liquids such as diesel, Naphtha and lPG through delayed coking process at an investment of Rs 3,110 crore.

The Minister said the Manali refinery was one of the most unique refineries in India with high speed diesel, lPG, lube, wax and petrochemical feedstock production facilities.

“The residue upgradation unit will increase distillate yield of the refinery in the form of more petrol, diesel, lPG and coke. It will also reduce production of low value fuel oil, enhance the gross refining margin and increase the bottomline of Chennai Petroleum Corporation”, he said.

The additional yield generated would result in increased availability of petroleum products and adequately fulfill the petroleum requirements of Tamil Nadu as well as that of neighbouring states of Andhra Pradesh and Karnataka, he said.

“It will also reduce India’s import dependency,” he said. The project would reduce production of fuel oil and increase percentage of high sulphur crude oil processing in crude mix, which would result in lesser feed cost.

later talking to reporters, Pradhan said he was confident that the Tamil Nadu Government would allot land for taking up expansion of CPCl’s Refinery located in Nagapattinam district.

“IOCl, CPCl board has already given approval to build up additional nine million metric tonnes capacity of refining at Nagapattinam. I think they (Government of Tamil Nadu) are on the job to give us the land.”

Chennai Petroleum Corporation has refineries at Manali near Chennai and Panangudi near Nagapattinam with an integrated refining capacity of 11.5 million metric tonnes per annum.