Date:06/05/2005 URL: http://www.thehindubusinessline.com/2005/05/06/stories/2005050601450700.htm

Back IndianOil Petronas plans Rs 250-crore terminal in Chennai

Pratim Ranjan Bose

Kolkata , May 5

INDIANOIL Petronas Pvt Ltd (IPPL), the 50:50 joint venture between Indian Oil and Petronas of Malaysia, plans to set up a second terminal at the Chennai port.

The joint venture currently owns a terminal at Haldia. The proposed new terminal may cost close to Rs 250 crore.

Company sources said that apart from importing LPG for marketing to commercial buyers and bulk supply to the oil PSUs, IPPL would offer the terminal services for LPG shipments to all oil PSUs. The service includes handling, storing and despatching the LPG cargo. The business contributes over 80 per cent of IPPL's turnover of Rs 180 crore in 2005-06.

IPPL recently sought terminal-business assurance from Indian Oil, which is the biggest player in the LPG market. If IOC agrees to shift part of its terminal business to Chennai, then other oil PSUs are expected to follow suit.

While expecting a higher rate of return from the proposed investment in Chennai, the sources said that the southern States are now fed through Mangalore, Kandla and Vizag ports. While Mangalore and Kandla are in the western coast, the operations at Vizag are reportedly on a comparatively smaller scale.