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NRL on schedule to open wax unit

Guwahati, Aug. 10: Numaligarh Refinery Limited will soon carve out its name in the petroleum wax sector by commissioning the largest wax unit in the country in the third quarter of the year.

“This will be the largest wax unit in the country when it gets commissioned. A marketing plan has been finalised and it will help save imports,” P. Padmanabhan, managing director of NRL, told The Telegraph.

At present, IOC’s Digboi refinery produces 32 TMTPA (thousand metric tonnes per annum) of paraffin wax while Chennai Petroleum Corporation Ltd, a group company of IOC, produces 20 TMTPA of paraffin wax. “NRL will be producing about 50 TMTPA of paraffin wax (43 TMTPA paraffin wax and 4.5 TMTPA of microcrystalline wax), making it the single largest wax producing unit in the country,” he said.

The wax project envisages production of high-value paraffin and microcrystalline wax utilising inherent properties of North East crude, which has high wax content. The project was approved in June 2010 and is being implemented at a cost of Rs 676 crore.

An independent financial consultant, PriceWaterhouseCoopers, was engaged to confirm the viability of the project.

PwC confirmed its viability saying the demand for paraffin wax exceeded its supply and microcrystalline wax demand is totally met by imports.

In 2013, the paraffin wax market in the country was estimated at 127 TMTPA. The largest players in the market are Digboi at 32 TMTPA followed by CPCL at 20 TMTPA, while 75 TMTPA of paraffin wax was imported.

Last year, India imported 75 TMT of paraffin wax from China and 12 TMT of microcrystalline wax from Europe and the US.

“The implementation of the wax project would help the company in diversifying its product portfolio in terms of an additional value-added product besides augmenting profitability,” a refinery official said.

At present, the focus of the company is on paraffin wax production and also looking at possibilities of producing microcrystalline wax.

In contrast to paraffin wax, microcrystalline wax is characterised by the fineness of its crystals in contrast to the large crystals of paraffin wax. It is generally darker, more viscous and denser and more elastic than paraffin wax and has a higher molecular weight and melting point. It is commonly used in cosmetic formulations.

On the marketing front, the company will market paraffin wax through nine distributors located all over the country and also directly to customers. The distributors will have to ensure monthly uplift of a certain quantity of wax.

The company has entered into a landmark and strategic agreement with Engineers India Limited (EIL), Delhi and Indian Institute of Petroleum (CSR-IIP), Dehradun, for “commercialisation and joint ownership of solvent de-oiling technology for production of petroleum wax”.

Paraffin wax is generally used for making candles, in tyre and rubber, leather, tarpaulin and PVC pipe industries, wax matches, polish and paints and cosmetics, among others.