The refinery is expected to process cheap, heavy crudes that are increasingly available to Asia, reported Reuters.
SMC Global Securities research and chief strategist head Jagannadham Thunuguntla was quoted by the news agency as saying: "It makes perfect sense to go aggressive in their core business of refining.
"The company’s balance sheet has enough firepower to finance refining and other businesses like telecom and retail."
Last year, the company sought the environment ministry approval in order to invest INR773bn ($12.8bn) for the construction of a new refinery and some polymer facilities as well as to shift the 450MW power plant’s fuel from gas to coal.
According to a government panel report, the country’s diesel and petrol product may lag demand by about 50 million tons by 2025.
The company is also seeking to improve the Jamnagar complex ability to produce more light products by processing heavier grades.
