Indian Oil is set to move one step closer to opening its Paradip refinery as it looks to appoint a project management contractor for the work within the coming days.

Though the company just recently reported "historic increases in margins" in May and June on the back of the volatility in global diesel and aviation fuel prices, it is nevertheless looking to keep the financing of the Paradip plant in check.

Already it has scaled back its plans for constructing an integrated refining and petrochemicals complex, with just the refinery to be set up in the fist phase of the works due to rising costs.

In addition, it has moved to appoint SBI Capital to look after the finances of the proposed grassroots refinery, with the capital expected to be in place by the middle of July.

"In the meantime, banking on the preliminary approval by the board, we will float the tender for appointing the PMC which is the first step towards project implementation," a source at Indian Oil told Business Line.

Just last week it was reported that Indian refines processed around 3.2 million barrels of oil a day in May, with the lower production levels of state-run plants largely offset by those of the expanded Essar Oil site.