New Delhi: Essar Oil is all set to swell annual capacity of its Vadinar refinery from 10.5 million tonnes to 34 million tonne, by next three years (2010).

The company will invest around $6 billion on this reformation. The company’s directors have already sanctioned the plans.

In the meantime, the company’s promoters have also dismissed their plan to de-list the company from the stock exchange.

A big part of the funding will come from the promoters — the Ruias. The company’s board, at its meeting, has approved a plan to lift $2 billion by issuing global depository shares (GDS) to promoters/promoter group on a preferential basis. On Friday, the company’s shares closed at Rs 192. On Nov. 1, the share was dealing at Rs 53.55. This recent growth in the share price was due to the bull run in the Indian stock markets.

The funds raised via GDS will be used to meet part of the requirement of funds for the capacity expansion of the Vadinar refinery and other corporate purposes, including refinancing/pre-paying existing arrears.

The board also decided to assemble an EGM on December 18 for shareholder approval to these plans.

The first stage of expansion will involve de-bottlenecking and the addition of more sophisticated bottom upgrading units such as delayed coker. Another phase of development will see a new set of distillation units, comprising addition of all secondary units and another coker.

On completion of the expansion, the refinery will produce high quality petroleum products meeting up the most stringent environmental norms i.e. Euro IV and Euro V internationally.

The Vadinar refinery was established with a total investment of $3 billion, and licensed in November 2006.