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Chemical production complex expected be commissioned in 2024
Taking forward their announcement on joint investments made in January this year, BASF and Adani have jointly announced the signing of a Memorandum of Understanding (MoU) with Abu Dhabi National Oil Company and Borealis AG, to undertake a joint feasibility study to evaluate collaboration on for the establishment of a chemical complex in Mundra.
With the inclusion of ADNOC and Borealis as potential partners, the companies are examining various structuring options for the chemical complex that will leverage the technical, financial and operational strengths of each company.
The joint feasibility study is likely to be finalised by the end of the first quarter of 2020.
The total investment for the project is estimated to be up to $4 billion (approximately Rs 28,500 crore). Production is intended to commence in 2024.
The collaboration includes evaluating a joint world-scale propane dehydrogenation (PDH) plant to produce propylene based on propane feedstock, to be supplied by ADNOC. Propylene will be partially used as feedstock for a polypropylene (PP) complex, which will be owned by ADNOC and Borealis - based on proprietary Borealis Borstar® technology.
The PP complex will be the first overseas production joint investment by ADNOC and Borealis, as part of a strategic framework with their current joint venture Borouge.
Dr. Sultan Al Jaber, UAE Minister of State and ADNOC Group CEO, said, "..Creating the first-of-its-kind polypropylene plant in India allows ADNOC and its partners to capture the promising growth in the Indian polyolefins market and also demonstrates our continued commitment to India."
Adani Group Chairman, Gautam Adani, said, "We are very pleased to collaborate with our international partners to establish a Chemical Manufacturing Complex at Mundra Port. We stand committed to the ‘Make in India’ initiative and serve the larger purpose of aligning growth opportunities, with the creation of goodness for the nation."
Dr Martin Brudermüller, Chairman of the Board of Executive Directors of BASF SE, said, "We will play a key role in driving this joint collaboration, which is also pioneering in terms of sustainability. We look forward to working together with our partners in establishing a chemical cluster in Mundra, and to supplying the Indian market high-quality downstream products."
Furthermore, propylene will be the key raw material for the previously announced acrylics value chain complex, comprising glacial acrylic acid (GAA), Oxo-C4 (butanols and 2-ethylhexanol), butyl acrylate (BA) and potentially other downstream products as part of a joint venture of BASF and Adani, in which BASF holds a majority.
The designated site is planned at Mundra port in Gujarat, and the products are predominantly for the Indian market, serving a range of local industries, including construction, automotive and coatings, a joint statement said.
The chemical complex in Mundra is intended to be entirely supplied by renewable energy resources. The partners are evaluating co-investment in a wind and solar park; plans are at an advanced stage of development.
If realised, this would be the world’s first world-scale CO2-neutral petrochemical site to be fully powered by renewable energy.
Alfred Stern, CEO of Borealis, said, "This partnership is a unique opportunity to strengthen our PP presence in India with proprietary Borealis Borstar PP technology, and to create value and tangible benefits through innovation for customers across multiple industries."
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