Adani Group on Thursday said it has joined hands with Abu Dhabi National Oil Company (Adnoc), German chemical giant BASF and Austria’s Borealis to study the feasibility of setting up a $4-billion chemical complex at Mundra in Gujarat by 2024.
The quartet have signed a MoU to “engage in a joint feasibility study to further evaluate a collaboration for the establishment of a chemical complex in Mundra, Gujarat”, the group said in a statement.
Products from the proposed unit will largely cater to the Indian market, serving the construction, automotive and coatings industries.
In January, Adani had announced plans to set up a Rs 16,000-crore chemicals factory at Mundra in partnership with BASF. The MoU signed now is the next step in that direction.
“With the inclusion of Adnoc and Europe’s second-largest producer of polyethylene and polypropylene — Borealis — as potential partners, the parties are examining various structuring options for the chemical complex,” a statement said.
The total investment is estimated to be up to $4 billion (about Rs 28,400 crore). The group, however, did not disclose the stakes that will be held by the firms. The partners aim to finalise the joint feasibility study by the end of first quarter of 2020.
“The collaboration includes evaluating a joint world-scale propane dehydrogenation plant to produce propylene based on propane feedstock supplied by Adnoc. Propylene will be partially used as feedstock for a polypropylene complex, owned by Adnoc and Borealis,” the Adani group said.
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.
The partners will also invest in wind and solar power plants at the site to meet the electricity requirement.
Sultan al Jaber, UAE minister of state and Adnoc Group CEO, said: “As the fastest growing energy market, India is crucial to our international growth ambitions in the downstream sector.”
This exciting collaboration is in line with Adnoc’s strategy to foster mutually beneficial partnerships, he said.