With the commissioning of our Naphtha Cracker unit at Panipat, we have embarked upon a journey to emerge as an integrated and diversified company that is actually moving up the hydrocarbon value chain. Such an aspiration is but a natural corollary to our ambitions to scale up and grow organically. Our diversification move has two major spinoffs. Internally, it would mean a change in our operational mindset. Externally, it would entail the rolling out of a marketing interface that would reach high quality petrochemical products in time to suit the customer's production cycle. An optimisation strategy based on an integrated linear programming model will be identifying the right crude mix to enhance our petrochemicals productivity.
The refinery and petrochemical business are essentially two different production models that are also linked at the core. A combined petrochemicals and refinery operations actually deals with about 25-30 different products which means different technologies from different licensors. Our Panipat complex joins a very elite list of purpose-designed integrated complexes in the world. But our task has only begun and we now move to the uncharted terrains of petrochemical marketing, which is a globally competitive business. The challenge therefore is to move fast and consolidate. We have rolled out a comprehensive transport contract for the entire country and our tie-up with CONCOR will enhance our logistics capability. The entire process of bagging, storage and dispatch has been benchmarked to the best in the world. A dedicated website - Project Care - for petrochemicals marketing has been introduced.
In another innovative move, we signed an agreement with TSRC Corporation, Taiwan and Marubeni for setting up of a Styrene Butadiene Rubber (SBR) unit at Panipat which will add value to the intermediate streams of our Panipat Naphtha Cracker Complex. IndianOil, has entered into an agreement with M/s. Ruchi Soya Industries Ltd. to establish a model Bio-diesel value chain in Uttar Pradesh which encompasses nursery management, contract farming and oil seed processing.
In the recent past, we have had to face a challenging situation wherein we had to efficiently manage our financials in the face of huge under recoveries and dynamic shifts in the economic environment. A deft handling of the situation ensured that we came out of the crisis unscathed. Much of that credit goes to our finance group headed by our Director (Finance). Recently, he was recognised as being amongst the Best CFOs in the country by Business Today and the entire IndianOil family joins me in congratulating him for this achievement. While we have a rich tradition of financial probity, there have been incidents which I believe are mistakes of omission. Inefficiencies in the finance process have this ability to build exponentially and blow up in the future, if not capped at the right time and right place. In the world of business, there are no second chances given for financial impropriety and any such violations will have consequences.
In yet another step towards highlighting the importance of safety practices in the Corporation's functioning, IndianOil invited Dr. Niall Ramsden, Director, Resource Protection International (RPI), UK, to address the senior management. We have established safe operating practices but such standards need constant evaluation, taking into consideration dynamic and evolving challenges. We need to continue to work towards establishing a safe work place and this is an ongoing exercise where there can be no compromise.
I had the opportunity of being a part of the Luit Utsav in Assam which, for perhaps the first time, was a cross divisional festival aimed at building a feeling of camaraderie among the IndianOil people in NEISO, GSPL, Bongaigaon, Digboi and Guwahati Refineries. The enthusiasm and bonding among our colleagues were palpable and more such celebrations are important in our endeavour to build a sense of companionship and team spirit among the people working in far flung areas.
On a visit to a location handling LPG in North East India, I happened to conduct a surprise safety check and the results were surprising to say the least. A few of the personnel were actually not fully aware of the standard operating practices. It is a good chance that my experience was an isolated one, but the importance of training all personnel, including contract workers and vendors, is vital. I would like to urge all colleagues to take it up on them to ensure that there is no compromise in the basic operating standards that have made us a leader in the petroleum business. I look forward to hearing from each one of you. Please send your responses and suggestions to my email at: bansalbm@iocl.co.in
B. M. Bansal
Chairman, IndianOil