Essar Oil cautious on Vadinar expansion

Essar Oil plans to be cautious about implementing its proposed US$6 billion expansion project at its 10.5 million ton oil refinery at Vadinar, Gujarat, India. The move is attributed to the Union Finance Ministry’s amendment that refinery units under construction by private sector companies will not be eligible for the seven-year tax holiday. Previously, all refineries including private sector-owned, have been enjoying 100% income tax exemption on refinery profits for seven years after commissioning. Private sector refineries including Essar Oil have urged the Union Finance Ministry and the Prime Ministers Office to roll back the amendment. (June 7, 2008)