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Essar Energy Limited

Refinery Site Visit
November, 2012
Disclaimer

2
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Essar Oil
Refining & Marketing
Essar Energy Site Visit
1st November 2012
Agenda of Presentation
 Industry Overview
 Refinery Business
 Supporting facilities at Refinery
 Sales and Marketing
 Annexure


4
Industry Overview
110
312
165
79
1000 1000
410
316
330
824
227
196
621
960
0
300
600
900
1,200
1,500
1,800
2,100
2009 2010 2011 2012 2013 2014
Asia Africa Europe US
Industry Trends
6 6
Global Oil Demand
84.8
86.1
86.3
85.2
88.2
88.9
89.8
90.6
81
83
85
87
89
91
2006 2007 2008 2009 2010 2011 2012 2013
Expected
 Global Oil Demand has grown by 3.0 mbpd in 2010
– one of highest in the history.
 Demand growth moderated in 2011 to 0.7 mbpd,
however, IEA estimates global oil demand to grow
by 0.8 to 1.0 mbpd for 2012 & 13.
 Global demand to grow mainly on account of
consumption driven growth in Non – OECD
countries led by China, India & Middle East.
Refinery Closure / Shutdown
Expected closure
 In last 4 years, 4.5 mbpd equivalent refineries
closed/ shutdown.
 Center of gravity has shifted from OECD countries
to non-OECD countries as most of refining capacity
additions are taking place in non – OECD countires.
 Net refinery capacity additions are sufficient only to
meet the incremental oil demand.
 Additional closures in Europe and US will put
upward pressures on refinery margin.
 Refinery margins are expected to remain robust in
Asia in next 2-3yrs.
Source: IEA
Source: Industry reports
mbpd
kbpd
7
Crude Prices and Product Cracks
Movement in Crude Prices
101
102
107
103
95
82
88
94 95
111
120
127
120
110
95
103
113
113
110
116
122
117
107
94
99
109
111
80
90
100
110
120
130
Jan/12 Feb/12 Mar/12 Apr/12 May/12 Jun/12 Jul/12 Aug/12 Sep/12
WTI Brent Dubai (US$/bbl)
Product Cracks
(US$/bbl)
19.43
17.60 17.81
16.26
15.39
19.27
8.52
5.56
2.84 3.36
3.70
4.82
20.36
18.75 18.23
15.56 15.96
20.21
11.66
14.64
7.60
11.76
10.55
12.42
-$10
$0
$10
$20
$30
April - Jun,11 Jul-Sep,11 Oct-Dec, 11 Jan- Mar,12 April - Jun,12 July-Sept,12
Gasoil FO Jet Gasoline
Light & Heavy Differentials
2.8
2.5 2.4
3.55
3.3
2.95
2.4 2.4
2.8
5.30
5.50 5.56
6.85 6.76
7.01
6.9 6.8
7.2
8.69
10.74
13.74
12.20
9.50
8.50
11.0
13.0
12.0
0
4
8
12
16
Jan/12 Feb/12 Mar/12 Apr/12 May/12 Jun/12 Jul/12 Aug/12 Sep/12
AL -AH diff AL - Norooz BL - Maya
(US$/bbl.)
 Benchmark Crude Prices continue to show volatility
on account of global economic outlook, geo-politics
in Middle East & Africa regions & European crisis.
 Diff. between Dubai & WTI continue to remain wide
& expected to moderate only after reversal of
cushing pipeline.
 Light & heavy difference remains range bound,
however, light to heavy & ultra heavy diff. improved,
providing incremental margin to highly complex
refineries
 Middle & light dist. continue to remain strong on
account of demand from non – OECD counties and
unplanned shutdown and closures of refineries and
low inventories
Source : Historical Platt’s (Singapore cracks)
Source : Historical Platt’s
Source : Historical Platt’s
Indian Refinery Capacity Additions & Petro Product Demand
8
Existing Refinery Capacity
Total Refining capacity 190 MMTPA
15
6
2
IOC Paradeep,
2014
NOCL, 2014
HPCL / CPCL,
2014
Estimated Capacity Additions
 Total Refinery Capacity excludes RIL SEZ
refinery intended for exports of petro products.
 No new refinery capacity addition expected in
next 3-5 years except as indicated above.
 HPCL‟s Maharashtra refinery, Rajasthan refinery
& other expansion projects announced by PSUs
are not considered as they are still at the early
stage of planning.
30% Refining
Capacity - over
35 years old
Source: Industry ; EOL
As on June 2012 Source: Industry
mmtpa
mmtpa
Global Economies – Shifting towards cleaner fuels
9
13 Major cities shifted to
EURO IV Norms from
2010 and 7 cities added
in 2012
Entire Nations is
expected to move Euro
IV in next 1-2 years and
government is planning
to implement Euro V in
major metro cities.
Source: EOL; Industry
EOL is well placed to capitalise on
growing domestic market (auto fuels
~8%) & demand of cleaner fuels.
Demand & Supply Balance of Petro Products
10
-5 -5
-6
-7
-9
-10
-12
-13
-15
3
3
5
4
2
-1
-3
-6
-9
3 3
3
3
2
2
1
1
0
5
8
7
1
-6
-14
-22
-31
-41
-50
-40
-30
-20
-10
0
10
20
FY 2011-12 FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20
LPG MS ATF HSD
Deficit of Gasoil
& Gasoline
Note : 1) Last 5 year (demand growth) CAGR replicated for projections.
2) We have assumed the base year as FY2011-12.
3) RIL SEZ assumed to continue in SEZ.
4) We have not considered the PSU refineries which are at conceptual stage.

Million tonnes
Source: EOL; Industry
Indian Oil and Gas Demand
11
22.3
9.7
5.5
3.7
2.6
1.1
USA EU Russia Brazil China India
Per capita oil consumption (annual barrels/person)-2012
Petro product growth in India
83.6
62.7
38.6
3.6
2.8
1.6
Russia USA EU Brazil China India
Per capita gas consumption (annual cubic feet/person)-
2012
9.0%
13.9%
11.5%
4.2%
8.5%
8.9%
6.7%
10.3%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
2008-09 2009-10 2010-11 April-Sept
2012
Gasoline Growth Gasoil Growth (Diesel)
Low per capita oil consumption
 Low per capita Oil & Gas consumption in India;
provides a huge potential to grow at faster pace in
order to catch up with developed economies.
 Petro products demand in India continues to be
strong led by growth in GDP, rising disposable
income, Govt. focus on development of infrastructure.
 Gas demand is growing at 20%+ rate, however, this
is also restricted due to constrain from supply side.
 Govt Policy to restrict Gasoil Price has created
abnormal demand growth in Gasoil, which has even
replaced Fuel Oil & CNG also apart from Gasoline.
Low per capita gas consumption
www.Indexmundi.com
IPR Report
www.Indexmundi.com
Why refining margins could remain high?
 Contraction in refinery capacity due to unplanned shutdown :
 Refinery capacity has contracted due to planned/unplanned refinery shutdown.
 Market witnessed more than 1.5 mbpd of refinery capacity closure in FY12 & expected likely
closure of another 1mbpd for FY13; resulting net refinery capacity addition to be negative in FY13
and with expected demand growth at 0.8mbpd. This would support refinery margins in the near to
medium term
 Global capacity utilisation under pressure : Refinery Utilisation unlikely to rise further due to high
average life of refineries and planned/ unplanned shutdown.
 Low Inventory level: Five-year-low inventory level to provide support to diesel cracks in the coming
quarter
 Strong diesel demand in India : Continuous strong diesel demand in India and Middle East will
benefit Asian diesel refiners and will result into healthy refinery margin.

12
Refinery Business
Business Structure
14
 20 mmtpa refinery at
vadinar with complexity of
11.8
 Low cost refining complex
centred around Vadinar
supersite
Essar Oil Limited - India
Essar Energy Plc
87.10%
Upstream
Midstream
Downstream
 Leading Indian CBM Portfolio
with 10 tcf+ reserves &
resources across 5 CBM
blocks
 Total reserves & resources ~
1.7 mmboe
 Set up ~ 1600 retail
outlets through
franchisee model
 Pan India presence of
Retail Outlets
Vadinar Refinery
15
Refinery Plot Plan
16
PROCESS
PLANTS
CCB & LAB
UTILITY &
POWER PLANT
PRODUCT TANKS
EFFLUENT TREATMENT
PLANT
ROAD
LOADING
DISPATCH
TANKS
RAIL LOADING
FLARE
UTILITY &
POWER PLANT
MAINTENANCE
FIRE
COKER
COOLING
TOWERS
PRODUCT TANKS
Strategic location & Global presence to drive the synergy

17
Crude intake
Crude intake


Proximity to the Middle East,
the largest crude oil source in
the world resulting in lower
crude freight costs

Presence in a major
maritime route from the
Middle East to the Far
East


Strategically located to cater the demand
of growing domestic market & supply to
global markets


Strong, captive infrastructure
like port / jetty, power plants of
Essar affiliated companies in
close proximity

Latin America
Major Units and Licensors
18
UNIT / FACILITY
CAPACITY
(MMTPA)
CAPACITY
Post OPTIMISATION
LICENCER /
TECHNOLOGY
DETAILED
ENGG
CDU / VDU*
10.5 (CDU)
7.2 (VDU)
18 (CDU)
10.9 (VDU)

VISBREAKER (VBU) 1.9 2.0 (CDU)
NAPHTHA HYDROTREATER (NHT) 1.6 1.8
CONTINUOUS CATALYTIC REFORMER UNIT (CCR) 0.9 1.1
FLUID CATALYTIC CRACKING UNIT / UNSATURATED
GAS SEPARATION SECTION (FCCU)
2.9 3.9
DIESEL HYDRODESULFURISATION UNIT (DHDS) 3.7 5.3
VGO HYDROTREATER (VGO HT) - 6.5
DIESEL HYDROTREATER (DHDT) - 4.0
DELAYED COKER UNIT (DCU) - 7.5
ISOMERISATION (ISOM) - 0.7
* Converted to CDU as part of optimisation project.
Unique Design Features for Vadinar Refinery
19
• Tallest crude column (90 metres height,
76 trays)
• Excellent swing capabilities
CDU
• Low pressure steam ejectors & vacuum
• Energy savings
VDU
• Converted to CDU.
• Capable to process ultra heavy crude on
standalone basis.
• Improved economics
• Maximum Conversion
VBU
• Very high pressure hydro treatment
• Capable of producing Euro V diesel
DHDT
• 6 Coker drum of 7.5 MT
• One of the largest Coker unit in the world
• Complete bottom of barrel vacuum residue into
valuable products.
DCU
• Produces Euro IV/V grade diesel
DHDS
• Produces LPG, Gasoline & Diesel streams
• Improves overall refinery flexibility
FCCU
• Produces Reformate & Hydrogen
• Reformate is a key component of Gasoline
• Hydrogen is used in DHDS
NHT/CCR
• Enables to make the increased proportion of BS-
IV and BS-V grade gasoline.
• Produces high octane Isomerate.
• Converts Naphtha to Gasoline.
ISOM Unit
• Hydro treat FCC feed to enable refinery to
produce premium quality low sulphur, high
octane product.
VGO-HDT
Vadinar Refinery – India‟s second largest private refinery
 World class, high complexity refinery
 405,000 bpd capacity
 11.8 complexity
 Low capital cost
 Total cumulative capex : US$5.03 billion
 Capex per barrel : US$12,746
 Capex per complexity barrel : c.US$1,080
 Low operating costs – c.US$2.8 / bbl
 Continuous focus on process innovation and
optimisation

20
Legends :
Indian Private Sector
NOC 1
NOC 2
NOC 3
NOC 4
NOC 5
23,000
19,800
26,500
18,000
20,400
10,700
12,746
-
5,000
10,000
15,000
20,000
25,000
30,000
World
Average
China Saudi
Arabia
India Indian
PSU
Refineries
Indian
Private
Sector
Essar
Energy
Vadinar
2
4
6
8
10
12
14
16
0 100,000 200,000 300,000 400,000 500,000 600,000 700,000
Indian Refineries
Capacity (bpd)
11.8
Large scale high complexity refineries
C
o
m
p
l
e
x
i
t
y

Source: EOL; Industry
Crude Mix and Sourcing Strategy
 Higher complexity enables processing of
ultra heavy & toughest crudes thus overall
reduction in crude cost
 Continuous optimization of crude diet ; 70-80
type of crudes processed in last 4 years.
 Avg API of crude processed improved to 28
compared to 33 pre expansion, expected to
further improve to 25 API upon widening the
diff. between light & heavy crude.

21
19%
56%
53%
29%
28%
14%
0%
20%
40%
60%
80%
100%
Pre Expansion Post Expansion
Light Heavy Ultra Heavy
 Requirement of ultra heavy crude is around 85 –
90 million barrel.
 Substantial qty. of Ultra Heavy crudes tied up
from Domestic market ~ 15%-20%, Latin America
~ 35% - 40%, Middle East ~ 30% ~ 40%.
 Focus has shifted towards Latin American
Countries like Venezuela, Brazil, Colombia,
Mexico.
 Term contract with Cairn India to supply 65000
bpd mangala crude from Rajasthan.

Crude Sourcing Strategy
85-90 mmbbl
Ultra Heavy
Crudes
Total
requirement
~150 mmbbl
60-65 mmbbl
Light & Medium
Crude
Majority of
requirement tied up
with term contracts
with global &
domestic suppliers
partly tied up to
take the
advantage of any
opportunity
available in the
market
Source: EOL
Product Mix and Evacuation Strategy
 ~ 83% of product slate is middle and light
distillate
 More than 50% of gasoil & gasoline will be Euro
IV & V compliant.
 Refinery fully capable to convert low value fuel
oil into higher value added products.
 Continue to focus on production of high margin
bitumen & fuel oil based on market dynamics.

22
31%
17%
42%
59%
27%
24%
0%
20%
40%
60%
80%
100%
Pre Expansion Post Expansion
Light Middle Heavy
 Tied up with PSUs on long term contract for supply
of products in domestic market.
 Executed agreement / MOUs with cement players
for supply of Pet coke.
 High demand of auto fuels in India in last 6
months, resulted 80% domestic sales. We expect
to maintain 70% & 30% ratio going forward.
 High complexity to provide an opportunity to
export high quality products for better realistion
 Leverage the group presence by placing the
relevant product in different markets.


Product Evacuation Strategy
Domestic
Market
Export
Market
LPG, Gasoil,
Gasoline, Petcoke
Gasoline, VGO,
Fuel Oil &
Petcoke
Source: EOL
Saving on account of Coal based Power Plant
23
 Coal Based Boilers and Power Plant provides a low cost source of Power and Steam to meet Refinery‟s
demand compared to liquid fuel or natural gas.
 Post Expansion Projects, Fuel & Loss increased to 8%.
 With start of Coal based power plant, fuel cost will reduced to 4.5%.
 Refinery will use Coal for Power plant and Natural Gas for refinery internal processes.
 This will save around 3%-3.5% of liquid fuel (Fuel Oil & Naphtha), which will be further converted into
other value added products.
 This will save minimum US$ 0.8/bbl for the Refinery.
8%
4.5%
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
Fuel & Loss ( based on crude throughput)
Pre Coal Power Plant Post Coal Power Plant
1.2 mmscmd
of Natural Gas
1.6 Million
Tones of Coal
Additional
Usage of Low
cost Coal &
Natural Gas in
Refinery
Source: EOL
10.30
11.60
15.00
12.20
6.60
8.40
8.70
7.60
3.62
1.60
4.53 4.23
4.69
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 Q1 FY13
Indian Complex Refinery Vadinar Refinery
Significant Gross Refining Margin uplift

24
 Increased complexity to provide incremental margins
in line with the peers with similar complexity
 FY12-13, refinery expected to deliver throughput ~
140 mn bbls
 FY13-14 throughput ~ 150 mn bbls, resulting in
increased GRM.
 Coal fired power and steam to add ~ US$0.8/ bbl to
GRM – benefit expected in Q4FY12.
 ~ US$ 720mn uplift in GRM expected.
* Assumed on throughput of 150 mmbbl & subject to market
conditions.
Vadinar Incremental GRM*

US$/bbl
US$ Million
Source: EOL; Industry
Source :EOL
60
720
540
120
0
200
400
600
800
Capacity
Additions
Complexity
Impact
Coal based
Power Plant
Incremental
EBITDA
 Vadinar Refinery received “Refinery of the year” Award from Petroleum federation of India.
 Essar Refinery Integrated Management System(ERIMS) conforms to the requirement of ISO 9001:2008,
ISO 14001:2004 & OHSAS 18001:2007 .
 Awarded first position in Safety, Health & Environment (SHE) Awards for year 2010 in manufacturing
sector (large) industries by CII.
 Gold category award for implementation of the 5„S‟, by the Quality Circle Forum of India.
 British Safety Council -International Safety Award with Distinction for its Health & Safety performance .
 Safety excellence award from Federation of Indian Chambers of Commerce & Industry (FICCI)
 National Award for Excellence in Water Management from Confederation of Indian Industry (CII)

Safe, Reliable & Sustainable operations
25
LTI free Man - days 1643
LTI free Man-hours 13.68
Major fire free
days
1228
As on 30
th
Sept, 2012
Benchmark study by Solomon
26
11
6
5
4
MAJOR PERFORMANCE INDICATORS
1st Quartile
2nd Quartile
3rd Quartile
4th Quartile
 EOL is among quartile 1
refineries in 11 of 26 major
performance indices among
Peer group – Some of these are
 Refinery Utilization
 Non Energy cash operating
expenses
 Maintenance Index
 Maintenance cost efficiency
Index
 Turn around index
 Personnel cost index

ESSAR: 11 OUT OF 26 MAJOR PERFORMANCE INDICATORS IN FIRST QUARTILE
Fuel and Loss
27
 Received 2
nd
Prize for performance
in Energy Optimization and
Hydrocarbon Loss Management by
CHT (under MOPNG) for
Jawaharlal Nehru Centenary
Awards-2011
 Received 3
rd
Prize for managing
Steam Leaks by CHT (under
MOPNG) during Oil and Gas
Conservation Fortnight (OGCF-
2011) survey
7.02
6.50
6.05
5.83
6.31
2007-08 2008-09 2009-10 2010-11 2011-12
Year - wise Fuel & Loss
Commissioning of
expansion units
A dedicated energy cell to monitor and optimize energy
Case Studies
 Essar Oil has a capability to produce upto
700 kT/Annum VG 30.
 This process has been developed in house
and which resulted in avoiding the
investment for Bitumen Blowing unit.
 Essar Oil also has capability to produce up
to 1500 kT / Annum of LSFO
 The company has the flexibility to swing the
production based on prevailing market
conditions.
 PCS made a feasibility study on the
conversion of VBU to CDU and submitted the
report . The report identifies modifications
needed to convert the VBU to a CDU/VDU at
a capacity of 2 MMTPA with 100% Mangala
crude oil from Rajasthan
 After DCU Unit stabilization, VBU Shutdown
taken and all modifications carried out and
Unit restarted as CDU on 15/06/2012. Unit is
running normal now.

28
VG-30 BITUMEN AND LSFO OPTIMIZATION PROJECT – VBU TO CDU
Sales & Marketing






Downstream sector in India
30
Sector
Deregulation in
2002
 In March 2002, the Indian Government announced a new policy allowing private sector
companies to obtain rights to market automotive fuels and aviation fuels in India, subject
to a minimum investment of at least US$392mn in the domestic oil industry infrastructure
Commercial sales
 Commercial sales include sales to domestic industrial customers on a bulk basis, as well
as sales to the National Oil Companies
 These sales are made at Trade Parity prices for Auto fuels and Import Parity Prices for
Kerosene and LPG
Retail sales
 As of today the Indian Fuel market is attempting to move towards a total decontrol of
pricing having already announced the deregulation of MS
 Retail outlets owned or controlled by the Indian Government (c.94% of the retail outlets
in India) are pricing their petroleum products below cost
 As a result, private sector oil companies have had to either similarly sell their petroleum
products below cost for a loss, or charge higher, non-competitive prices
 The subsidy mechanisms in place by the government, compensates public sector OMCs
for majority of their losses by way of oil bonds and discounts from its upstream E&P
companies (ONGC, Oil India and GAIL)
Global oil players : Esso, Caltex,
Burmah Shell
Nationalised : Formation of IOC, BPCL and
HPCL
Liberalisation: Deregulation,
entry of private players such as Essar and
Reliance
Pricing of Refinery Products
31
Sales
Export
Petrol / FO /
VGO
FOB Vadinar
PSU‟s/Bulk
HSD / MS
Trade Parity
Price
Kero/LPG
Import Parity
Price
Retail
Petrol
TPP + Retail
Margin
HSD
Govt
regulated
Price
Trade Parity Price: Import parity (80%) & export parity prices (20%)
Import Parity Price: Import price + duties + freight + insurance + transport cost
VGO, Pet Coke and Sulhpur prices are determined on the basis of mutual discussions between
buyers & sellers while Naphtha prices are based on Refinery Transfer Pricing (RTP)
Sales Mix
32
26%
25%
32%
34%
20%
65%
60%
57%
59%
73%
3%
8%
5%
2%
6%
6%
8%
6%
5%
1%
0%
20%
40%
60%
80%
100%
FY09 FY10 FY11 FY12 Q1FY13
Export PSU Bulk Retail
 Continue to focus on domestic market due to better price realization of petro products.
 Export products include Gasoline, VGO, Fuel Oil and Petcoke.
 Domestic sales in Q1FY13 higher than expected due to strong domestic demand and late monsoon.


Source :EOL
Retail Marketing

 First private sector company to set up Retail Outlets on
Franchisee based Model ( DODO)*
 Retail Network Strength ~ 1600 ; Operational ROs ~ 1400;
balance under various stages of construction.
 Deregulation of Gasoline enabled us to ramp up of retail
sales volumes of Gasoline.
 EOL‟s strategy to rationalise its retail network & future
expansion of network will be pursued in controlled manner
until sustainable pricing scenario linked with International
market prevails.
 CNG/ALPG# & other Non Fuel Revenue activities
continue to bring additional revenue streams for
franchisees.
 Total ALPG & CNG station increased to 21 and are
achieving impressive growth.

33
3
74
16
26
40
3
4
195
43
27
70
37
11
5
159
4
103
35
60
103
1
70
3
215
11
26
2
* DODO - Dealer Owned Dealer Operated, CNG – Compressed Natural Gas; APLG – Auto Liquefied Petroleum Gas.
Franchisee Business Model
34
Limiting EOL’s capital commitment
• Land owned by franchisee
• Lease to EOL for 20-30 years
• Land leaseback and franchise agreements
• Investments for construction, installation, operation
borne by franchisee

Protection against downside
• EOL pays 5% rental on land
• Franchisee earns 5% RoI for setting up outlet,
linked to pre-agreed monthly sales target
• Volume-linked sales commission (monthly)
• High crude price – 12.5% compensation to retain
retailer
Maximize margins when Oil price low
• Outlets opened when oil price low
• Potential upside from Indian fuel subsidy regime
reform

Non fuel retail
• Revenue sharing agreements with channel
partners.
• Revenue from sales of non-fuel products
Franchisee Model
Other Facilities at Vadinar
Fire Fighting and Fire Protection
36
 Mobile facilities – 5 Foam Tenders, 2 Foam Nursers, 1 DCP tender.
 Round the clock trained fire fighting crew
 Auxiliary fire fighting squad
 Fire and gas detection system
 Clean agent fire fighting system in process control rooms
Captive Power Plant & Utilities
37
POWER PLANT:

Three Boilers
Two STG’s – 77 MW power

Two GT’s with HRSG – 220
MW

Expansion – Two coal
based boilers - 1500 TPH
steam
Three STG’s – 300 MW
World Class Laboratory

38
Modern Maintenance Workshop

39
Effluent Treatment Plant

40
Modern Effluent Facilities help in Recycling all effluent back to process units thus making Essar a
Zero Discharge Refinery

Supporting facilities at Refinery

41
Ports & Terminals (Owned by EPL)
 1 SPM, Draft – 32 m crude; intake capacity: 27 mmtpa
 2 Jetties (1+1) for product offtake : 14 mmtpa
 Pipelines & other supporting infrastructure facilities completed
Supporting facilities at Refinery

42
Tankages, Rail & Road Gantries (Owned by EPL)
 136 tankages ( 106 + 30) for crude oils, products and Intermediates with capacity of ~ 2.94 Million KL
(1.96 Mn KL earlier + 0.98 Mn KL expansion);
 Fully automated Loading Facilities; 3-White Oil truck Gantries, each 8-Bays; 2-LPG loading Gantries,
each 8-Bays; 1-Black Oil loading Gantry of 10-Bays
 Fully automated loading Rail Gantry with 2 spurs (48 wagons @2400 mt ) - 5.5 mmtpa; Length of
Gantry: 680 mtrs
 Products : LPG, Gasoline, SKO, ATF, Diesel, FO and Bitumen
First Petcoke Deliveries
43
• RBI recently approved Essar
Oil‟s proposal to raise $ 1.5
billion through external
commercial borrowings (ECB)
to refinance its rupee
denominated debts with
existing lenders.
• Refinance of Rupee debt with
ECBs to provide an annual
interest saving of Rs4.5 – 5bn
crore, mainly due to reduction
of interest rate by 4-5%
Financial Engineering
44
CDR Exit
• CDR Exit Proposal of
Company approved by CDR
Core Group August, 2012
• CDR Exit to provide
operational flexibility for
decision making.
• It also offer an opportunity to
reduce cost of debt through
restructure of debt Mix &
participation of foreign banks.
• CDR expected to be
completed in next 2-3 months.
Sales Tax
• Sales Tax matter concluded
with final judgement from
Supreme Court to pay the
balance sales tax liability in 8
quarterly instalment in 2 year
from Jan, 2013.
• The Company is planning to
pay the sales tax liability out
of internal accruals
generated from business
operations and credit line of
Rs50bn available with bank,
if required.
ECB Funding
The Essar Advantage
45
Crude Sourcing
• Located at nearest point to
major crude sources
• All-weather, deep-draft port,
capable of handling VLCC.
• No dredging requirement
• 50% term contract & balance
spot to take advantage of
opportunity crude
• Approx. 90% heavy & ultra-
heavy crude post Phase-I &
Optimization
• Blending of crude
• Sourcing of domestic Mangala
crude 15%-20% of basket
Product Slate
• Highly Complex Refinery,
capable to produce Euro IV/V
Specification products post
Expansion
• Elimination of negative crack
FO, conversion into value
added light and middle
distillates
• 80% middle & light distillates
• Utilization of Coal & NG for
refinery and power plant to
further reduce the operating
cost
Market Dynamics
• Auto fuel (MS/HSD)
demand in India to grow at
5%-10%

• Anchor load to come from
domestic market

• Product pricing in India
(Trade Parity Pricing)
favoring sales in domestic
Market.

• Export of High Value
products to developed
markets.




One of the most Complex Refineries globally
GRMs : Beating Benchmarks
Annexure
Refinery Safety
Refinery Safety Rules
48
Safe Entry and Safe Exit Policy
49
ZERO
ACCIDENTS
Safety Rules & Regulations
Induction & Training
Meeting
Audits
Compliance Enforcement
House Keeping
Tool Box Talks
Awards / Accreditations
50
 Refinery has bagged the prestigious British Safety
Council International Safety Award 2009 and 2010
second time in a row.
 Received Certificate of Merit for C.I.I. Award for
Excellence in Management of Health / Safety /
Environment for the year 2009 from ICI.
 Essar has bagged OISD Safety Award for the year 2009-
10 in the category “Oil Refinery”. Essar is the first private
refiner to receive this award.
 Gujarat Safety Council state award for excellence in
Safety for the year 2008 as well as for 2009.
 Essar Oil has been selected for a “Special
Commendation” for the „Golden Peacock Award for
Occupational Health & Safety for the year 2010.
 Vadinar Terminal has achieved 5 Star in the
Environmental Audit conducted by the British Safety
Council in 2009 & 2010; only Terminal to achieve a
Double 5 Star – In Health & Safety and Environment.

 Essar Oil Ltd won National Safety Council USA, 2010
Industry leader award for achieving best safety
performance within its industry


Sustainability @ Essar Oil
51
Healthcare

Education

Environment

Sustainable livelihood
Corporate
Social
Responsibility
 Financial support for local teachers and students.
 Building, repair and maintenance of schools and
educational facilities.
 Donation of computers, notebooks and stationary.
 Support for and implementation of educational
schemes and projects of local governments.
 Classes for computer education, language, and adult
literacy.

 24 hour Community Health Center at Jankhar
village, near the Vadinar refinery.
 Mobile medical clinics reach out to villages at our
operational sites in Vadinar and Raniganj.
 Mother & Child welfare clinics and OPD centres at
various locations.
 Health check up camps, including eye-care,
cancer, vaccination and general health check-ups
for school children

 State-of-the-art air pollution control equipment at all sites.
 Anti-plastic campaigns at schools.
 Conservation of water and other natural resources.
 Maintaining flora and fauna.
 Afforestation and biodiversity conservation.

 Construction of a water tank
 Providing computers and sewing machine to a local
jail
 Periodically vaccination programs.
 Provides fodder and water assistance to
surrounding villages during summer.
 Periodically vaccination programs.


Corporate Social Responsibility
52
Occupation Health Centres at Site, City and Township
Corporate Social Responsibility
53
Learning Centre
Health, Safety and Environment
54
MANGROVES PLANTATION
CORALS & MARINE LIFE
GREEN BELT – 700 ACRES
Green Belt and Marine Life Protection

India Trends – 2030
55
 India‟s GDP is expected to grow in the 7-8% range in the next five years
 590 million people will live in cities, nearly twice the population of United States today
 91 million urban households will be middle class, up from 22 million today
 700-900 million square meters of commercial space and residential space needs to be built – or a new
Chicago every year
 2.5 billion square meters of roads will have to be paved, 20 times the capacity added in the past decade
 7400 kilometers of metro and subways will need to be constructed – 20 times the capacity added in the
past decade
Source : Various industry reports
Expansion Process Flow Diagram
56
VGO HT
DHDT
DCU
ISOM

CDU 2
CDU
CN
Blending
Mangala
Crude
Thank You