Kuwait energiser for ONGC
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- Published 3.11.14
New Delhi, Nov. 2: Kuwait’s Petrochemical Industries Company (PIC) plans to pick up around 26 per cent in two ONGC projects for about $1 billion.
Sources said Kuwait’s state-owned company was in the final stage of negotiations to acquire stakes in ONGC Petro additions Ltd (OpaL) and ONGC Mangalore Petrochemicals Ltd (OMPL).
“PIC is expected to invest $700 million in OPaL at Dahej and $250 million in OMPL in Mangalore,” sources said.
The Kuwaiti company is expected to pick up about 24 per cent in the Dahej project and another 26 per cent in the Mangalore project.
ONGC holds 26 per cent in the OPaL venture, in which GAIL (India) Ltd and Gujarat State Petroleum Corporation Ltd (GSPC) are also partners.
In OMPL, ONGC plans to keep 46 per cent in the venture, while its subsidiary, Mangalore Refinery and Petrochemicals (MRPL), will own another 3 per cent.
While the petrochemical unit of OPaL is yet to be commissioned, the Mangalore plant of OMPL had started production in September.
The OPaL project includes a dual feed cracker unit, having a capacity of 1.1 million tonnes (mt) per year of ethylene and 400,000mt per year of propylene.
There are other associated units that include a pyrolysis gasoline hydrogenation unit and butadiene and benzene extraction units.
In addition, OPaL is setting up a high-density polyethylene (HDPE) and a low-density polyethylene unit, each with a capacity of 360,000mt per annum. Production is expected to begin in 2015-16.
ONGC’s Rs 6,000-crore petrochemical project in Mangalore includes an aromatic complex designed to produce 0.9mt per annum of paraxylene and 0.3mt per annum of benzene. Feedstock for the complex will be supplied by the MRPL refinery located adjacent to OMPL.
Major petrochemical items include ethylene, polyethylene or polythene (PE), paraxylene (PX) and purified terephthalic acid (PTA). Growth will be driven by demand from automobiles, packaging, agriculture and infrastructure sectors.
“India’s polythene (PE) demand will likely increase 129 per cent from 2013 through 2023, far surpassing Asia’s projected growth rate of 81 per cent and China’s 87 per cent for the period. On a metric-tonne basis, that means the overall PE demand in India is projected to climb to 8.2 million per annum by 2023, up from 3.6 million per annum in 2013,” said a research note by energy research firm Platts.
ONGC’s Perspective Plan 2030 involves a road map to diversify into downstream ventures and achieve 30 per cent of group revenue from non-E&P (exploration and production) businesses.