Gandhinagar: Indian Oil Corporation Limited’s (IOCL) Gujarat Refinery expansion is moving into a key execution and commissioning phase, with the company targeting sustained operations at 18 million metric tonnes per annum (MMTPA) by the end of FY2026-27.
The expansion is part of IOCL’s ₹18,936-crore Lube-Petrochemical Integration Project (LuPech), which aims to increase the refinery’s crude-processing capacity from 13.7 MMTPA to 18 MMTPA.
The expanded capacity is equivalent to approximately 360,000 barrels per day.
IOCL Gujarat Refinery Expansion Targets 18 MMTPA
Biplob Biswas, Executive Director and Refinery Head, Gujarat Refinery, indicated on September 30 that sustained operations at the expanded capacity are expected by the end of FY2026-27.
While the primary crude-processing capacity can be increased, achieving full-scale operations will depend on the commissioning of associated downstream facilities.
This makes the commissioning and integration of various units a key milestone for the overall project.
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Polypropylene Plant to Add 5 Lakh Tonnes of Capacity
A major component of the LuPech project is a polypropylene plant with an annual production capacity of 500,000 tonnes.
The facility is expected to begin production by the end of FY2026-27 and will use propylene produced through Indian Oil’s INDMAX technology.
Polypropylene is widely used across several industries, including:
- Packaging
- Automotive components
- Textiles
- Consumer goods
- Industrial applications
The new facility will allow Indian Oil to convert refinery streams into higher-value petrochemical products, helping the company strengthen its petrochemical portfolio and cater to domestic demand.
India continues to import polypropylene despite having an established domestic manufacturing base. The additional production capacity is expected to support import substitution, although it is not expected to completely eliminate the country’s dependence on imports.
Lube Oil Base Stock Facility to Strengthen Product Portfolio
The LuPech project also includes a Lube Oil Base Stock (LOBS) facility with a reported production capacity of approximately 270,000 tonnes per annum.
Lube base stocks are key raw materials used in the production of automotive and industrial lubricants.
The addition of the LOBS facility, along with the polypropylene plant, will enable Gujarat Refinery to diversify its output beyond conventional transportation fuels.
The project is therefore aimed not only at increasing crude-processing capacity but also at generating a larger share of higher-value fuels, lubricants and petrochemical products.
LuPech Project Progress and Commissioning Timeline
According to IOCL’s Q3 FY2025-26 investor presentation, the LuPech project had an approved cost of ₹18,936 crore.
The project’s physical progress stood at 85.8% as of December 31, 2025, with an expected commissioning date of November 2026.
However, the latest reported timeline indicates that sustained operations at the expanded 18 MMTPA capacity are targeted by the end of FY2026-27.
These timelines do not necessarily represent a contradiction because commissioning individual facilities and achieving stable, integrated operations across the refinery are different stages of project execution.
Commissioning and Integrated Operations Remain Key Milestones
The performance of the Gujarat Refinery expansion will ultimately depend on the successful commissioning and integration of its interconnected facilities.
Key factors that will determine the project’s operational performance include:
- Commissioning of associated downstream units
- Stable operating rates
- Integration of refinery and petrochemical facilities
- Product yields
- Commercial performance of additional output
Achieving the expanded crude-processing capacity is therefore only one part of the overall project. Sustained and commercially viable operations across the integrated facilities will be important for the project to deliver its intended benefits.
Gujarat Refinery Moves Towards Integrated Refining and Petrochemicals
The LuPech project marks a significant shift in the strategy of IOCL’s Gujarat Refinery, moving beyond conventional refining towards greater integration of refining and petrochemical production.With additional polypropylene and lube-base-stock production, the refinery is expected to have a broader product portfolio and greater exposure to higher-value products.
About Indian Oil Corporation Limited (IOCL)
Indian Oil Corporation Limited (IOCL) is one of India’s major state-owned energy companies and operates across refining, petroleum products, petrochemicals, natural gas and related energy businesses. The company operates a network of refineries and fuel distribution infrastructure across the country and is also expanding its presence in higher-value petrochemical and energy segments.
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