ONGC, GAIL eye stake in Kochi petrochem project

Oil and Natural Gas Corporation (ONGC) and GAIL (India) are keen on picking up a stake in the Rs.5,000-crore Kochi petrochemical project being executed by Bharat Petroleum Corporation Limited (BPCL) in joint venture with LG Chemicals of South Korea.

“We have got written proposal from several companies to join the project. ONGC and GAIL have also shown interest in taking equity stake in the Kochi venture,” BPCL Chairman and Managing Director R. K. Singh told journalists on the sidelines of the Petrotech Conference here on Tuesday. The petrochemical complex is being built with LG Chemicals as the lead partner.

“LG will take 51 per cent stake, and for the moment BPCL has the remaining 49 per cent. We have not yet decided on taking more partners. The equity structure of the petrochemical joint venture has not yet been finalised. But it has been more or less agreed that LG will be the lead partner,” he added.

The project will be built along with the Rs.14,500-crore expansion of the Kochi refinery from 9.5 million tonnes to 15.5 million tonnes by 2015-16. As part of this project, it would be establishing a petrochemical fluid catalytic cracker to generate 500 tmtpa of propylene. This would offer BPCL a launch pad for diversification into petrochemicals. Completion of the project would be dovetailed into the refinery expansion project.

Mr. Singh said the petrochemical project was expected to be completed by December 2015, and commissioned by March 16. It would produce high-value products such as acrylic acid (which is currently not produced in India) and super absorbent polymers that are used in manufacture of diapers. Also, it would manufacture oxoalcohol, a feedstock for manufacture of paints and certain cosmetics.

Kochi refinery’s new units would include a 10.5 million-tonne crude distillation unit, a 2.2 million-tonne fluid catalytic cracker (FCC) unit, a 4.3 million-tonne diesel hydrotreater, a 3 million-tonne vacuum gasoil hydrotreater and a 3.84 million-tonne delayed coker. The FCC will produce about 2.15 million tonnes of propylene annually.