PCL vice-president for operations S Ilanahai told The Financial Express that the company was studying the possibility of manufacturing and marketing fuel oil additives for kerosene and naphtha as the market was fast expanding in the country.

At present, it is manufacturing furnace oil ELF AC 133 which is a combustion improvement. ``It helps 4 per cent savings in consumption of heavy fuel oil and reduces pollution,'' he said.

PCL has got the technology from ELF and has a capacity to manufacture 600 kilo litres of this additive. Another unit to manufacture storage stabiliser ELF AC 382 with a capacity of 100 KL is under erection and is to be commissioned before the year-end. This additive is for prevention of sledge in storage tanks.

The project cost is Rs 3 crore including Rs 1 crore for buying technology from ELF. The furnace oil additive is already being used by 200 industrial units in the western and southern regions.

The company also plans to import diesel flow improvers and market 25 to 30 KL initially.

Fuel additives market, according to Ilanahai, is growing rapidly and could go up to Rs 100 crore level from the present Rs 20-30 crore in three or four years. The prospects are considered bright since the administered price mechanism of petroleum products is to cease from April 2002. Once this happens, the market will be open and OEMs can have the option to use fuels and additives of their choice.

PCL is strong in the south. It caters to additives requirements of several leading companies including Tamilnadu Petroproducts, Indian Additives, Spic, BHEL-Trichy and industrial units in the Manali industrial belt. According to Ilanahai, prices of additives have remained the same during the last five years while fuel prices have shot up by 60 per cent in the last three months alone. The cost of additives is less than two per cent of the fuel price, he said.