National Refinery Limited (NRL) plans to invest Rs. 1.3 billion to revamp its distillation unit at its plant, Lube-1 in collaboration with a Chinese company. The two companies signed a contract worth $8.42 million for the upgradation.
According to a stock filing, NRL disclosed that it entered into an Engineering, Procurement, Construction and Commissioning (EPCC) agreement with China-based HUALU to revamp its two-stage distillation unit at its Lube-1 Refinery.
NRL expects to fund the project through internal resources, and the timeline for the completion of the project is stated to be 18 months.
With the completion of the project, the company expects to increase Lube-1 refinery’s crude oil processing capacity by 5,000 barrels per day to the present capacity of 1.65 million barrels a year. It will further increase the production of Lube Base Oil (LBO) by 6,000 tons a year to add to the existing production of 44,724 barrels per year.
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According to an estimate, this will increase Lube-1 refinery’s crude oil processing capacity by 41.5% and it will increase the refinery’s LBO capacity by 8.4%.
NRL Kicks Off Production of Isomerization Unit
NRL is also expanding its production capacity in a different sphere to get its share in the increasing demand of petroleum products in the local market.
Last year in October, it started its operation of Isomerization Unit (PENEX) and its Auxiliary Units (Naptha Splitter and Naptha Hydrotreater).
This unit increased its production of 90 RON motor gasoline (petrol) from 156,000 metric ton per year to 292,000 metric ton per year.
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Besides, in compliance with the direction of the government, Diesel Hydro De-sulphurization (DHDS) Unit commenced operation before 30 June 2017 reducing sulphur contents in HSD below 500 parts per million (ppm).
By the end of first half of the financial year 2017-18, NRL posted a profit of Rs.1,623 million resulting in earnings per share of Rs. 20.30, compared to profit after tax of Rs. 3,968 million resulting in earnings per share of Rs. 49.62 in the same period last year.