India building world’s largest oil refinery to serve the West


Reliance's existing petrochemical plant at Jamnagar, Gujarat. It processes 660,000 bpd and lies in third position on the global table

JAMNAGAR, India: In the West, India’s reputation rests largely on its prowess in providing services at low cost, while China is seen as the world’s factory.
But India is also making great strides in manufacturing industry.
Reliance Industries, India’s largest private corporation, is currently building the largest oil refinery site in the world on the country’s western coast near Jamnagar in Gujarat State.It aims to have the refinery producing high-value fuels from imported crude by December 2008.The fuels are exclusively for export to the West, primarily to Europe and the US.Founded as a textile concern, Reliance is now one of India’s most successful companies, but it has only in recent years entered the oil sector.In 1996 the company began building its first refinery at Jamnagar, against the advice of experts who warned business would be “lousy.”The complex was built over an area equivalent in size to around a third of Manhattan Island in only 36 months, by comparison with the more usual four-to-five years.Reliance confounded the experts and now regards the refinery, which went onstream in 1999, as the jewel in its crown.

It processes 660,000 bpd and lies in third position on the global table.
Alongside the successful existing plant, a new one is rising up. Work began on December 1 last year, with December 2008 pencilled in for the date the refinery goes onstream. “We are attempting to beat this target,” says Reliance Industries director Hital R Meswani. The refinery is budgeted to cost $6bn. At the peak of construction there will be up to 100,000 people working on the site. Once complete, the refinery will process 580,000 bpd, boosting total capacity at Jamnagar to 1.24bn bpd – more than anywhere else in the world.
The first refinery already produces mainly for export. The second will be devoted entirely to foreign customers. The refinery is being built in one of the new special economic zones set up in India. Over the first five years of operation, all income from exports will be tax-free, while only 50% of the income will be taxed over the succeeding five years. Neither the imported crude nor the fuel processed for export will be subject to customs duties.
The aim at the new refinery is to turn the lowest-quality, and thus cheapest, crude into top-quality fuels commanding the highest prices on world markets.
World supplies of high-quality “sweet” crudes are in decline, while ever-increasing amounts of heavy crude with a high sulphur content is being pumped.

The price difference last year was around $5 a barrel for Arabian oil. At the same time demand for high-quality, low-sulphur fuels is on the rise in the West as a result of stricter environmental standards. “We can process virtually any kind of crude,” says Meswani. The fuels to be produced at the new refinery will meet the highest environmental standards in Europe and the US, even though they are produced from low-quality crude. Only around 30 of the 660 refineries currently operating in the world can achieve this. Older plants are not able to do this, and Meswani says that 72% of the plants in production are 25 years old or older. The refineries in Europe and the US are almost all older, and in any case almost all the refineries are working at capacity or near to it. According to Meswani, modernisation has not been carried out in time. Reliance believes it will not face serious competition from refineries that can match Jamnagar until 2010. Meswani sees Jamnagar’s significance reaching well beyond the subcontinent. The refinery “golden age” for Asia is dawning. “Reliance is building a refinery for the West on an Indian site,” he says, adding that the refinery is simultaneously a challenge to those who believe China is always ahead of India when it comes to industry. – DPA

Knowing Reliance, if they are setting up the next by 2008, I can guarantee that they are already working on the third one and that would come up by 2012.

How much time would it take for Reliance to set up a network in competition to Rogers/Fido/Telus or Virgin in Canada ?.


http://us.rediff.com/money/2006/nov/25ril.htm?q=bp&file=.htm


RIL plans private GSM network

BS Reporter in New Delhi | November 25, 2006 13:00 IST

Mukesh Ambani's Reliance Industries Ltd is preparing to apply for permission to set up a nation-wide broadband telecom network for internal (non-commercial) use.

The network will in part use the global system for mobile standard for mobile communications, as well as the latest broadband wireless technologies like WiMax to support a number of business applications.

The idea behind the network, which may entail investments of up to $750 million in the long term, is to connect Reliance Industries entire set-up in the country onto a common intelligent backbone.

This will serve various ends -- connecting the entire Reliance Retail supply chain and front-end to a real time platform and linking the Reliance Petroleum chain, as well as hooking up the company to various trading centres and commodity exchanges in India and abroad.

The company will also use the network for connectivity within its planned special economic zones and to meet bandwidth demands.

Crucially, the company plans to use its own \"interface devices\" in the network. It is not clear yet whether the platform will also provide voice connectivity to Reliance Industries employees.

The need for a telecom network arose after the split in the company, which saw the Reliance Infocomm network go to Anil Ambani.

Subsequently, RIL moved much of its business to other operators -- Airtel for voice connectivity and Bharat Sanchar Nigam Ltd for leased line connectivity.

Given its huge communication needs (by some estimates, Reliance Industries pays between Rs 200 cr (Rs 2 billion) and Rs 250 cr (Rs 2.5 billion) per annum for leased line connectivity alone to BSNL, it makes sense for the company to invest in an internal network, especially given the ease with which regulatory approvals are likely to materialise, as well as the cheap equipment costs.

An added advantage is the experience that some key company employees have in setting up and managing telecom networks.

The company will have to apply to the department of telecom for approvals, including grant of frequencies to operate the network.

Planning was on and a blueprint for the network was expected soon, said sources. State entities like the railways, defence establishment and police rely on extensive internal communication networks.

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Speech by Thomas Friedman of The New York Times....

"When we were young kids growing up in America, we were told to eat our
vegetables at dinner and not leave them. Mothers said, 'think of the
starving children in India and finish the dinner.' And now I tell my
children: 'Finish your maths homework. Think of the children in India
who would make you starve, if you don't.'"