Financial Daily from THE HINDU group of publications
Tuesday, Mar 09, 2004
IOC eyes Gujarat, Haryana for naphtha cracker plant
Mumbai , March 8
INDIAN Oil Corporation Ltd is evaluating locations in Gujarat and Haryana for setting up an eight-lakh tonnes-a-year naphtha cracker.
The project, part of IOC's Rs 15,000-crore investment plan for expanding presence in the petrochemicals business, is expected to be completed by first quarter 2007.
IOC plans to invest Rs 6,300 crore in setting up the greenfield naphtha cracker with downstream polymer complex and a standalone polypropylene unit.
"We are in the process of procuring technology for the plant. The bids have been called and we will take a decision shortly. Also, the location for the plant will be decided within a month or so," a senior IOC official told Business Line.
The project is expected to help IOC expand presence in the petrochemicals business through building the ethylene capacities. The only competing capacities for the product in India are with Reliance Industries.
"We have planned a world-scale ethylene capacity which can be ramped up to one million tonnes. There are only a couple of projects this size in the world," the official said.
Indian Oil has lined up a master plan for petrochemicals with an investment of Rs 15,000 crore in Phase-1, mainly through vertical integration with its core refining business and utilising the streams available at its various refineries, Mr M.S. Ramchandran, Chairman and Managing Director, IOC, had said at the company's analysts' meet last year.
Two major projects that are already being built are: Production facilities for LAB (linear alkyl benzene) at Gujarat refinery scheduled for completion by June, and PX/PTA (paraxylene/purified terepthalic acid) at Panipat expected to be commissioned by May 2005. Both these projects together are estimated to cost about Rs 6,000 crore.
This will be the third large petrochemical project floated by IOC.
"The second phase of investments depends on acquiring a stake in Haldia Petrochemicals. IOC plans to invest Rs 700 crore in HPL revamp. Also, we plan to invest Rs 5,000 crore for setting up a propylene capacity by pooling feedstock from IOC refineries in the Eastern region. Iran's National Petrochemicals Company has in-principle agreed to pick up a stake in the project," the official said.
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