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IOC announces investments to upgrade refineries to Euro VI standards

State-owned Indian Oil Corp. (IOC) said it will invest INR 13,000 crores (USD 1.9 billion) to upgrade its refineries that will enable them to produce Euro VI-compliant fuel products.

The Indian government announced recently that it will implement Euro VI emission norms from April 1, 2020, and skip implementing Euro V as originally planned, to combat the countryโ€™s pollution woes. The official notification has not yet been issued, however.

“It is an extremely challenging task but we will do it,” said Sanjiv Singh, IOC Director (Refineries). He said that an additional INR 7,000 crores (USD 1.04 billion) has been spent to upgrade to Euro IV. “This is already being done as we would need to sell BS IV [Bharat Stage IV is the equivalent of Euro IV) across the country by April 1, 2017,” he said.

IOC estimates that the move to Euro VI would raise the cost of producing gasoline by INR 1.45 (US 2 cents) per litre and diesel fuel by INR 63 paise (US 1 cent) per litre.

IOC also said it will need to invest INR 40 billion (USD 598 million) to upgrade its newest refinery in Paradip, Odisha. The 300,000-barrel-per-day (bpd) refinery, which was commissioned last year, was designed to produce Euro IV- and Euro V-compliant fuels only.

India’s public sector oil marketing companies are expected to invest INR 28,750 crores (USD 4.3 billion) to upgrade their refineries to produce Euro VI-compliant fuels.