April 12, 2012 [Trafigura Pte Ltd] - Trafigura Pte Ltd today announced the investment of up to $130 million into a significant equity stake (up to approx. 24%) in the Nagarjuna Oil Corporation Limited (NOCL) oil refinery. The refinery is being constructed at Cuddalore in the State of Tamil Nadu, India. In addition to acquiring an equity stake, Trafigura will invest a further $120 million into the construction of extensive storage facilities and associated infrastructure at the refinery’s 2,500 acre site.
Trafigura’s investment in the NOCL refinery is the first of its kind for the company, enabling it to create operational efficiencies and to add value to its customers’ supply chains. Geographically, the facility is well positioned to receive crude oil from Trafigura’s international producer partners. The investment also affords the company the ability to participate in India’s domestic market where rising incomes, higher vehicle sales and rapid urbanisation are driving the country’s position as one of the world’s fastest-growing major economies.
The refinery to be operated by NOCL will have an annual capacity of six million tonnes. It can process 100% heavy/sour grades of crude and will supply light and middle distillates up to European IV standards. Other partners in the project include TIDCO, a Government of Tamil Nadu enterprise, and Tata Petrodyne, a Tata Group enterprise.
The location of the refinery, on the east coast of India, provides numerous strategic advantages including the ability to receive Very Large Crude Carriers (VLCCs) via a single point mooring. It is also well-positioned to meet the needs of the State of Tamil Nadu which currently has a shortfall in the supply of clean petroleum products.
Commissioning work at the refinery is expected to start this year with commercial operations scheduled to begin during the first half of 2013.
