British Petroleum (BP), one of the world's largest energy and petrochemical companies, plans to expand its India operation by setting up a 1 mln ton petrochemical plant. To be built at an investment of Rs 3,500 crore, the plant may come up in Gujarat. The company is in talks with Indian oil refiners to buy paraxylene as feedstock to make purified terephthalic acid (PTA). Oil refiners currently avoid selling naphtha directly in the market because of declining margins, but prefer to produce paraxylene and sell it to petrochemical makers.
BP is one of the big players in PTA globally with a market share of about 20%. In Asia, it is present in countries such as China, South Korea and Malaysia. This investment follows an unsuccessful attempt to enter the refining business through a tie-up with state-owned Hindustan Petroleum Company's upcoming 9 mln ton Bhatinda refinery three years ago.