Chennai Petroleum to Expand Manali Refinery Capacity by One-Third to 280,000 BPD – Indian PSU
Chennai Petroleum Corporation Limited (CPCL), a subsidiary of Indian Oil Corporation Limited (IOCL), has announced plans to expand the crude oil refining capacity of its Manali refinery in Chennai by nearly one-third, increasing it from the current 210,000 barrels per day (bpd) to 280,000 bpd.
The proposed expansion was disclosed in CPCL’s Annual Report 2025-26. While the company has confirmed its intention to undertake the capacity enhancement, it has not specified a timeline for completing the project.
The Manali refinery is one of southern India’s key refining facilities, producing a wide range of petroleum products, including transportation fuels, lubricants, waxes, and petrochemical feedstocks. The planned expansion is expected to strengthen CPCL’s refining capabilities and support the country’s growing energy demand.
Strategic Shift for Cauvery Basin Project
CPCL has also outlined a significant strategic change for its Cauvery Basin project in Nagapattinam, Tamil Nadu. The company’s Cauvery Basin Refinery (CBR) was decommissioned in 2019 after it became uneconomical to upgrade the existing configuration to meet evolving fuel quality specifications.
Although CPCL had initially planned to rebuild the refinery with upgraded processing capabilities, the company has now decided to transform the project into a petrochemicals complex, reflecting changing market dynamics.
According to the annual report, the Cauvery project will now be redesigned to enhance petrochemical intensity, capitalizing on the strong domestic and global demand for petrochemicals and specialty chemicals. Indian Oil Corporation, CPCL’s parent company, will hold a 75% stake in the reconfigured project.
Focus on Petrochemicals Growth
The strategic shift underscores the Indian refining sector’s increasing emphasis on value-added petrochemical production amid rising demand for specialty chemicals and improved margins compared to conventional transportation fuels.
With the proposed expansion of the Manali refinery and the transformation of the Cauvery Basin project into a petrochemicals hub, CPCL aims to strengthen its long-term growth strategy while aligning its operations with evolving energy and chemical market trends.
