Indian Oil executive director and state chief of Telangana and Andhra Pradesh B. Anil Kumar talking to the media in Hyderabad on December 28, 2022. Photo Credit: Special Arrangement
The petroleum terminal being set up by Indian Oil Corporation at Malkapur near Hyderabad with an investment of ₹611 crore is likely to be commissioned next year.
Since it will be the endpoint for the 1,212-km Paradip-Hyderabad product pipeline, the terminal is expected to benefit IndianOil in terms of fuel supplies to Telangana. “By December 2023, we will be able to make the terminal operational… bring our own product,” IndiaOil executive director and state head for Telangana and Andhra Pradesh B Anil Kumar said here on Wednesday.
The pipeline, with an investment of ₹3,338 crore, is to carry petrol and diesel from the state-owned oil company’s Paradip refinery to Hyderabad in Odisha, one of the major consumption regions, and connect Visakhapatnam, Vijayawada and a few other places . Andhra Pradesh on the way.
Diesel supply through pipeline has started from this month to Vijayawada. “The pipeline work has been completed and the tankage work is underway at Malkapur,” said Mr. Anil Kumar in his first media interaction after taking over as Executive Director in September. The storage capacity of the terminal will be 1.80 lakh kiloliters.
Once commissioned, the pipeline and terminal are expected to reduce Indian Oil’s dependence on Hindustan Petroleum Corporation’s Visakhapatnam-Hyderabad pipeline for fuel supply to Telangana. Indian Oil will also shift the operations of its terminal at Cherlapalli near Hyderabad. However, the Cherlapalli facility is unlikely to be closed, he said.
Responding to questions, he said the consumption of petrol and diesel in Telangana has crossed pre-COVID retail sales levels. Petrol consumption during April-November was 13.2% higher than the same period last fiscal. Retail diesel usage was higher by 10.2% in the same period. Average monthly sales are around 1.23 lakh tonnes of petrol and 2.66 lakh tonnes of diesel.
higher VAT
While petrol consumption is increasing due to expansion in Hyderabad and surrounding areas, the increase in diesel consumption in Telangana and Andhra Pradesh is due to higher Value Added Tax in both the states. “The difference in prices is huge due to local taxes,” said Mr. Anil Kumar, noting that heavy vehicles plying interstate prefer to tank up at retail outlets in neighboring Maharashtra, Karnataka and Odisha to benefit from the lower prices. Huh.
Listing IndianOil’s initiatives in Telangana, he said that under the SATAT (Sustainable Alternative Towards Affordable Transportation) program that encourages entrepreneurs to set up compressed biogas plants to supply CBG to oil companies, IOC has Seven LOIs have been issued for setting up such facilities in Telangana. Three of them will come up in Hyderabad and one each in Jangaon, Mahbubnagar, Medchal and Warangal. The CBG procured from the plants will be marketed through retail outlets of IndianOil.
Besides Cherlapally, the company has a storage facility at Ramagundam. The total capacity of both the installations is 11.86 Lakh KL Petrol and 42.56 Lakh KL Diesel. The company, which has 1,425 retail outlets, launched 337 new ROs in the last 3 years. In the current financial year, 168 ROs will be added to it.
On blending ethanol with petrol, he said IndianOil has achieved 10% blending in both Telangana and Andhra Pradesh. However, it is not following through with plans to set up an ethanol refinery following the Indian government’s directive that private entrepreneurs should be allowed to set up such facilities.