Reliance Petroleum to commission plant in December 2008

Reliance Petroleum Ltd has announced that the Company has made remarkable progress on all implementation fronts for its global sized, complex refinery coming up in a Special Economic Zone at Jamnagar. The fast track implementation efforts of the Company have resulted in achievement of significant progress on the ground, with overall project progress nearing 50%, in just 15 months since commencement of the project. The Company is well on its way towards setting a new benchmark in the global refining sector.

During the quarter, project implementation gained further momentum with civil, structural and mechanical work getting into full swing, in turn resulting in a substantial change in the skyline of the project site at Jamnagar. Some of the significant milestones achieved during the quarter are:

- Achieved 80% completion of detailed engineering work.

- Procurement and contracting efforts nearly completed; over 4400 critical and long lead equipments ordered globally:

- Completed 1,000,000 cubic meters of concreting work.

- Site infrastructure mobilised to sustain the construction on fast tract.

Achievement on the engineering front has been as planned. While basic engineering is complete, 80% of detailed engineering work is also completed. Almost entire scope of drawings for concrete and underground piping has been released to the site. Over 7,500 engineers are continuing to work on the project across the globe, at several interconnected locations delivering world-class engineering output for the project. Towards reducing construction interferences and minimum rework at site, the Company has embarked on a massive 3D site modeling effort, which is nearing completion and should yield significant benefits in the coming year.

While procurement and contracting efforts are nearly complete, deliveries of critical and long lead equipments, including heat exchangers, turbines, fired heaters, amine absorbers have already commenced at site. In fact, equipment installation has taken off in full swing during the quarter. Remarkable progress has been made on procurement of bulk materials required for the project. Over 80% of structural steel and substantial requirements of piping materials have been delivered at site. Emphasis has shifted towards vendor monitoring and follow-up for ensuring compliance with quality and delivery commitments.

With over a million cubic meters of concrete poured at site, over 75% of civil construction work is now complete. During January 2007, a new record in construction was achieved with 185,000 cubic metres of concrete poured in a single month, surpassing all earlier benchmarks. On the back of remarkable progress in civil construction activities, piping and equipment front generation has progressed rapidly. Nearly 40,000 tonnes of structural steel fabrication work and about 34,000 tonnes of tankage fabrication has been completed at site. Nearly 30% of pipe fabrication and pipe erection work is also complete.

At the industry level, global refining fundamentals remain intact and promise exciting value creation opportunity for complex refineries. The continuing shortage of global refining capacities coupled with tightening product specification, slow growth in desulphurization capacities and widening light heavy differentials is expected to result in widening demand supply gap for transportation fuels globally. Buoyant outlook for the global economy augurs well for petroleum products and reinforces confidence on long term prospects for the sector.

Commenting on the progress Mr. Mukesh Ambani, Chairman of the Company said "I am pleased with rapid progress achieved by RPL on all fronts of implementation and believe that the town is fully equipped to sustain the rapid pace of construction in the coming quarters. The substantial progress achieved so far gives me confidence that the project is well on track for completion by December 2008. RPL is thus poised to benefit from emerging opportunities in the sector and create superior value for its shareholders".

Source : Equity Bulls

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