Oil India Ltd (OIL) to acquire 49% equity in Assam Petrochemicals Ltd

13-Jun-13

In a strategic move, Oil India Ltd (OIL) is set to acquire 49% equity in Assam Petrochemicals Ltd (APL), credited to be the first company in India to manufacture petrochemicals using natural gas as feedstock. A deal with the Assam government, which holds majority stake in the company through Assam Industrial Development Corporation Ltd (AIDC), is likely by October, as per Business Standard. The Assam government currently holds 88.2% stake in the AIDC, while domestic institutions and others hold the remaining stake. The Union government-controlled OIL would bring in the much-needed equity infusion of about Rs 230 crore in the company. It will also partly fund Rs 1,030-crore investment in building a new petrochemical plant at Namrup in Assam. APL is looking for a partner to invest in its expansion and diversification by implementing a 500 ton a day (TPD) methanol plant, along with a downstream plant of value-added product for production of 200 TPD of acetic acid. The expansion projects were vital for APL as its unit was incorporated in 1971 through Japanese technology. APL also has lined up projects such as installation of a di-methyl-ether plant and a bio-diesel plant as its future products. OIL already has stakes in Brahmaputra Cracker and Petrochemicals Ltd (BCPL), a joint venture with GAIL India, the Assam government, and Numaligarh Refinery Ltd.