Reliance refinery fire may hurt cooking gas supplies (SECOND LEAD)

Ahmedabad/New Delhi, Oct 25 (IANS) Cooking gas supplies may be affected in India due to a fire Wednesday at the Jamnagar oil refinery of Mukesh Ambani's Reliance Industries that injured one person. The fire was contained soon after.

Wednesday, October 25, 2006 | 6:23:00 PM IST (+05:30 GMT)
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Ahmedabad/New Delhi, Oct 25 (IANS) Cooking gas supplies may be affected in India due to a fire Wednesday at the Jamnagar oil refinery of Mukesh Ambani's Reliance Industries that injured one person. The fire was contained soon after.

'One Reliance employee was seriously injured. There are no other casualties,' a company statement said. The company's refinery is located in Gujarat, close to the Arabian Sea, some 300 km south of the state's commercial capital Ahmedabad.

'The fire broke out at the hydrotreating unit number two of the refinery at around 11 a.m. It has since been contained. The unit was immediately evacuated,' a company official said. 'We are still assessing the damage,' he added.

A faulty valve at the unit - one of the 40 facilities at the plant - was stated as the reason for the fire.

The refinery - the world's third largest at a single location - has a primary refining capacity of 660,000 barrels of crude per day and accounts for close to 25 percent of India's production of fuel products such as diesel and gasoline.

'We expect a shortfall of around 120,000 tonnes of LPG (liquefied petroleum gas - or cooking gas). But necessary alternate arrangements are being made to ensure that supplies are not affected,' Petroleum Secretary M.S. Srinivasan said in New Delhi.

State-run Indian Oil Corp, he said, has been asked to step up imports to bridge the anticipated shortfall. The demand for LPG is estimated at around 11 million tonnes this fiscal. India imports close to 70 percent of its fuel needs.

For Reliance, the shutdown of the unit could result in losses of between Rs.80-Rs.120 million ($1.7-$2.6 million) per day, experts said.

According to officials at Jamnagar, a loud explosion was heard at the refinery a little before 11 a.m. after which flames several meters-high were seen leaping out from the site. Fire tenders at the unit doused the flames in two hours.

The hydrotreating unit that caught fire processes 16 percent of the company's production capacity of 33 million tonnes, company officials said.

'As a pre-cautionary measure, the neighbouring Diesel Hydrotreating Unit - II has also been shut down safely. We expect to restart the same shortly,' the Reliance statement said.

'All other refinery units, including both the crude units and petrochemical units, are operating normally.'

Experts said the unit is critical to the 7,500-acre petrochemicals complex since it removes impurities from products so that they have a higher-octane value and fetch a much better price.

It may take at least a week to restart the unit, they said.

The company's shares were not trading Wednesday since the markets were closed on account of Eid-ul-Fitr. The company's market capitalisation, at $36.73 billion, is the largest for any listed company in the country.

Reliance Industries had recently reported a turnover of $12.132 billion and net profit of $1.14 billion for the half-year ended Sep 30. Its refinery operated at 94.9 percent capacity during the period and processed 15.7 million tonnes of crude.

Its Jamnagar unit had faced a major natural disaster in 2001, when a devastating earthquake had damaged pipelines, equipment and civil work, resulting in a loss of production for<

Copyright : Indo-Asian News Service
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