HPCL, GAIL to divest up to 50% stake in AP petrochem plant
HPCL and GAIL are looking at setting up a 1 million tonnes Ethylene Derivatives plant, which will produce a wide range of petrochemical raw materials for the manufacture of detergents, paints and coatings, cosmetics, textiles and adhesives. "Currently, it is a 50:50 project but we are open to inducting a strategic partner," HPCL Chairman and Managing Director Mukesh K Surana said here. The project at Kakinada in Andhra Pradesh, will cost Rs 30,000 crore. "We are willing to give up to 50 per cent stake in the project to the strategic partner," he said.
Some global petrochem companies have shown interest in the project but talks are at preliminary stage currently, he said without disclosing details. The planned project is a truncated version of the earlier proposed refinery-cum-petrochemicals complex in Andhra Pradesh. HPCL has for the timebeing shelved plans to build a new refinery and is only pursuing petrochemical project. HPCL and GAIL decided to do the petrochem plan together after their plans to team up with France's Total, Lakshmi N Mittal Group and Oil India Ltd (OIL) for a 15 million tonnes a year refinery-cum-petrochemical plant at Visakhapatnam in Andhra Pradesh fell through. "That project fell as partners pulled out one after the other due to weak global demand," another official said. "Now, HPCL and GAIL are looking at setting up a petrochemical plant at the Petroleum, Chemical and Petrochemicals Investment Region (PCPIR) sites identified by the state government at Kakinada."
Surana said currently detailed feasibility report (DFR) is being prepared and details will work out following that. HPCL owns a 7.5 million tonnes refinery at Mumbai and a 8.3 million tonnes unit at Vizag. While the Vizag plant is being expanded to 15 million tonnes, HPCL is expanding the Mumbai refinery to 9.5 million tonnes at a cost of Rs 4,000 crore by 2019, he said.