Trafigura acquires stake in India’s Nagarjuna Oil

Trafigura Pte. Ltd., a wholly-owned subsidiary of Trafigura Beheer B.V., the world’s third largest independent oil trader, said it has invested up to US$130 million to get a significant equity stake (up to approximately 24%) in Nagarjuna Oil Corp. Ltd. (NOCL) oil refinery. The refinery is being constructed at Cuddalore in the Indian state of Tamil Nadu. In addition to acquiring an equity stake, Trafigura will invest an additional US$120 million to construct extensive storage facilities and associated infrastructure at the refinery’s 2,500-acre site. Trafigura’s investment in the NOCL refinery is the first of its kind for the company. Geographically, the facility is well positioned to receive crude oil from Trafigura’s international producer partners. The investment also gives the company the opportunity to participate in India’s domestic market where rising incomes, higher vehicle sales and rapid urbanization are driving the country’s position as one of the world’s fastest-growing major economies. The refinery to be operated by NOCL will have an annual capacity of six million tons. It can process 100% heavy/sour grades of crude oil and will supply light and middle distillates up to Euro IV standards. Commissioning work at the refinery is expected to start this year, with commercial operations scheduled to begin during the first half of 2013. Jonathan Pegler, director of Oil Asia Pacific, said “This is an important, long-term venture for Trafigura and is an exciting project for all concerned. It plays directly to the strengths of Nagarjuna as a leading process operator and to Trafigura as a company committed to balancing international supply and demand for oil products.” Other partners in the project include TIDCO, a Government of Tamil Nadu enterprise and Tata Petrodyne, a Tata Group enterprise. (April 12, 2012)