Chennai Petroleum shuts refinery for maintenance- unlikely to have impact IOC's naphtha supplies

27-Jul-12

Chennai Petroleum has started planned maintenance at its 190,000 barrels per day (bpd) Manali refinery in Chennai, as per Reuters. One of three crude distillation units (CDU) is in the process of being shut and will be down until the end of September. The Chennai plant has a majority of distillates yield, which means parent company IOC could likely enter the spot market to import diesel to plug the shortfall in the domestic market. This could boost premiums for the low sulphur diesel grades, imported by India, as supply has been tight in Asia amid refinery maintenance in Singapore and Japan, two major exporters of the product in Asia. The shutdown of the crude unit is unlikely to have a major impact on parent company IOC's overall naphtha supplies. IOC exports from Chennai only when there is a surplus of volumes. Since the start of the year, IOC has sold 35,000 tons per month of naphtha out of Chennai in January, March, April and June.