New Delhi: Essar Energy Plc on Monday said it has begun implementing a 100-day integration plan at UK's Stanlow oil refinery, which it had recently bought from Shell for USD 350 million, to improve operating efficiency.
"We have now commenced a 100-day plan to integrate the Stanlow refinery into Essar Energy portfolio," Essar Energy CEO Naresh Nayyar said in a conference call.
The plan will focus on how to improve operating efficiency and identify capex required to be spent in medium and long-term basis.
"It involves identifying operational cost savings, productivity improvements and opportunities to utilise a heavier crude slate and improve the product mix," he said.
Stanlow refinery, near Ellesmere Port in the North-West of England, is the second-largest refinery in the UK, with a nameplate capacity of 296,000 barrels of oil a day. It, however, operates at around 210,000 bpd or 70 percent of the capacity and supplies about one-sixth of the UK's petrol and is also a key manufacturer of diesel and aircraft fuel.
Essar Energy, he said, was an India-focused company and it looked for overseas assets to secure raw material – coal mines for power stations and exploration and production assets for its refineries. Stanlow buy was to acquire access to UK and Europe fuel market.
"It takes us substantially closer to our objective of a global refining capacity of one million barrels daily," Nayyar said.
The acquisition of the Stanlow refinery gives Essar direct access to the UK market. It is also aligned with its strategy to provide options for the export of high value fuel products from its refinery at Vadinar, in Gujarat.
Vadinar has a capacity of 300,000 bpd, which will be raised to 375,000 bpd as part of Phase-I expansion plans, due to be completed by the end of this year, and to 405,000 bpd by September, 2012.
Essar Energy also owns a 50 percent stake in the Kenya Petroleum Refineries Ltd refinery in Mombasa, Kenya, which has a nameplate capacity of 80,000 bpd.
The acquisition of the Stanlow refinery together with the completion of the expansion project at Vadinar will deliver total capacity of 741,000 bpd refinery throughput by March 2013," he said.
First Published: Monday, August 22, 2011, 21:37