In a setback to Indian Oil Corporation’s (IOC) plans to enhance refining capacity, the scheduled commissioning of the Rs.30,000-crore Paradip refinery has been delayed by almost one year. It is now expected to be ready for operations only in September 2013.

The 15 million tonnes per annum refinery was earlier scheduled to be commissioned by November this year. However, the commissioning has been hit by various factors, including delay in construction in power plant by Bharat Heavy Electricals Limited (BHEL), non-availability of forest and environment clearance for South jetty, and encroachment of Sandhkund basti affecting laying of pipelines from jetty to the refinery and construction of coastal roads. Delay has also been noted in delivery of equipment and fittings by the vendors, according a status report filed with the Petroleum and Natural Gas Ministry.

The refinery was also affected by the changes made in sourcing of power from Tata joint venture power plant which eventually did not work out. Changes in engineering works needed to be carried out due to this development and work was subsequently awarded to BHEL in February 2010 leading to delay of almost 11 months in starting work on the captive power plant. However, work by BHEL is also running behind schedule, according to the report. The report also points to the delays due to deteriorating law and order situation at the project site which had a big impact on the work schedule due to less availability of manpower.