The capacity increase at Essar’s Vadinar refinery, slated to finish next year, will enable the production of Euro IV and Euro V-standard gasoline and diesel for export, Chief Financial Officer P. Sampath said in an interview in Mumbai yesterday.

“We’ll look at opportunities to take acquisition interests in any form to place these products in international markets,” Sampath said. “It can be buying some tankages, it can be buying a refinery elsewhere if it’s available cheaper.”

Essar Oil Ltd., a unit of London-listed Essar Energy, started talks last year to buy three refineries in Germany and the U.K. from Royal Dutch Shell Plc, which is seeking to reduce costs and cut spending after the global recession. The talks are continuing, Sampath said, declining to comment further.

Shell said Aug. 20 it agreed to sell the 90,000 barrel-a- day Heide refinery in Germany to U.K. private equity firm Klesch & Co. Ltd.

The Vadinar refinery, located in Gujarat state, will increase capacity by 29 percent to 18 million metric tons a year by the end of 2011, according to Essar Energy’s website.

Sampath said Essar Energy may also increase gasoline exports from Vadinar to East Africa, where the company and Kenya’s government own equal stakes in Kenya Petroleum Refinery Ltd., which operates a facility at Mombasa. The plant, the only refinery in East Africa, currently processes 1.6 million tons a year and supplies a region with demand of as much as 7 million tons a year, he said.

The Mombasa plant processes less than its full capacity of 4 million tons a year due to lack of investment in maintenance and upgrading, according to Essar Energy’s website.

Euro IV and Euro V fuels meet stricter emission standards. The Euro IV standard specifies a maximum of 50 parts per million of sulfur in diesel, while the Euro V grade has a maximum of 10 parts per million, according to the United Nations Environment Program website.