IOC and Haldia Petro's planned refining and petrochem projects delayed by problems with land acquisition

17-Sep-19

Indian state-controlled refiner IOC and private-sector Haldia Petrochemicals (HPL) have hit delays in planned refining and petrochemical projects because of problems with land acquisition, as per Argusmedia.com. The projects, both in Odisha, need a combined 6,000 acres (60km²) of land, but the state government has only made a small amount of this available. It typically takes at least five years after land allocation and clearances before a project can be commissioned, IOC said.

IOC is planning to expand its 300,000 bpd Paradip refinery to 500,000 bpd to feed a proposed petrochemical complex, including a naphtha-based cracker, 1.2mn tpa purified terephthalic acid (PTA) plant, 108,000t tpa polyester staple fibre plant, dual-feed cracker and petroleum coke gasification plant. The company has sought about 4,000 acres of land for the expansion, but the state government can only provide 800 acres. 

IOC in February commissioned a 680,000 tpa polypropylene plant at Paradip and has awarded construction contracts for a 357,000 tpa monoethylene glycol (MEG) plant and 180,000 t/yr ethylene recovery unit to private sector L&T Hydrocarbon Engineering. These plants are targeted for start-up by 2021, while the PTA plant may be commissioned by 2022, regardless of the delays to land acquisition for the cracker project. IOC and other Indian refiners are increasingly focused on petrochemical investments as government efforts to boost electric vehicles cast doubt over transport fuel demand. 

HPL is planning to invest at least 300bn rupees ($4.2bn) in a refinery that will run light crude and be integrated with an ethylene cracker and aromatics complex to produce 1.6mn t/yr of paraxylene and 2.5mn t/yr of PTA. The refinery capacity is unclear.

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