The move is being mooted to allow IOC to connect the port of Paradip in Orissa state to its Haldia refinery located in West Bengal. It is also being seen as a way to help ease traffic through the Haldia - Barauni pipeline.

The project is currently awaiting government approval and is expected, according to IOC chairman M.S. Ramachandran, "[to] take three years to complete the pipeline project."

"The new pipeline will be the lifeline for IOC, as Haldia and Barauni refineries are incurring huge losses because of the additional cost of transporting crude through Haldia port where larger vessels cannot call in," added Ramachandran.