GAIL mulls expansion to capitalize on increasing demand for petrochem

GAIL (India) Ltd is planning to expand further to capitalize on the growing domestic as well as global demand for petrochemicals. Several options including acquisition of or equity participation in an existing petrochemical plant in India or abroad are being considered to meet booming demand. Currently, the growth of petrochemicals sector is 12%- a double digit figure, far exceeding the economic growth rate. GAIL is planning a seven fold capacity expansion of its petrochemical production to over 2 million tpa at an investment outlay crossing Rs 13,000 crore spread over a time span. The de-bottlenecking of the Swing Plant at Pata for increasing LLDPE production capacity from 160,000 tpa to 210,000 tpa has been completed at a cost of Rs 59 crore. The Rs 647-crore petrochemical plant expansion project for increasing ethylene capacity from 3,00,000 tpa to 4,40,000 tpa with an additional cracking furnace and a new HDPE plant of 100,000 tpa capacity is underway. Under active consideration by GAIL is a 50% stake in a one million tpa gas cracker in Iran in collaboration with National Petrochemical Company. Decision weighs on the results of the feasibility study being carried out for the project. The two other major petrochemical plants under various stages of planning and approval are the Assam Gas Cracker project and Kochi Petrochemical complex. Assam Gas Cracker Project GAIL has been nominated to set up a grassroots gas cracker project in Assam, with an probable investment of Rs 5,200 crore. The Government of Assam, Numaligarh Refineries Ltd and Oil India Ltd (OIL) are also expected to participate in the project, to have production capacity of 2,80,000 tpa of polymers. The gas is to be supplied by OIL and ONGC, while naphtha is to be sourced from Numaligarh Refinery Ltd. Under evaluation by GAIL is the option of setting up complex using the MTP (Methanol to Propylene) Technology of Lurgi, Germany, for conversion of abundant lean gas to polymers as opposed to rich gas, which is available in lesser quantities than lean gas. Kochi Petrochemical complex. Another integrated grassroots petrochemical plant is being planned at Kochi with a capacity of 7,00,000 tpa at an investment of Rs 7,000 crore. This ethane-propane (C2-C3) based petrochemical complex will produce 600,000 tpa of ethylene and 100,000 tpa of propylene. The feedstock for this plant, will be imported LNG, which will be re-gassified at the terminal of Petronet LNG Ltd at Kochi. GAIL proposes to enhance the production capacity of its petrochemical plant at Pata from 3,10,000 tpa.