Oil and Natural Gas Corporation (ONGC) will by the year-end commission a Rs 1,100-crore plant at Dahej to extract C2-C3 compounds from natural gas and will sell them to Reliance Industries Ltd’s (RIL’s) owned IPCL till its plant to convert them into polymers comes up in 2012.
“Yes, the plant is on track for commissioning by end 2008,” ONGC Chairman and Managing Director R S Sharma said.
C2-C3 (ethane, propane) will be extracted from the rich-gas Petronet imports in the form of liquefied natural gas (LNG) at Dahej in Gujarat from Qatar. These compounds would then be fed into a Rs 13,600-crore petrochemical plant to manufacture polymers. Until the petrochemical complex is build by February 2012, C2-C3 may be sold to IPCL, he said. “Some of it can also be exported.”
Sharma said ONGC was in discussions with companies like GAIL India for induction as equity partners in the petrochemical plant.
GAIL has been offered 9 per cent equity in the project but the company wants 19 per cent in ONGC Petro-additions Ltd (OPaL), the special purpose vehicle formed by ONGC for setting up the petrochemical complex at Dahej SEZ.
ONGC holds 26 per cent stake in OPaL and 5 per cent is with Gujarat State Petroleum Corporation (GSPC). Companies like Petronet LNG may also join the project.
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A technology provider like Japan’s Mitsui Chemicals and Mitsubishi Chemical Corporation, who are consumers and traders of the product, may also join the project to take the balance equity.
The debt-equity ratio of the petrochemical project is 2.55:1. The petrochemical complex would comprise a global scale cracker and downstream polymer plants, Sharma said.
This complex would be integrated with ONGC’s C2-C3 plant which is currently under execution (at Dahej) and Naphtha as feedstock from ONGC’s operational units at Hazira and Uran.
The complex comprises 1.1 million tonnes per annum of ethylene capacity dual feed cracker, along with associated units and polymer plants, to manufacture HDPE, LLDPE, PP and Styrene Butadiene Rubber. The cracker would have the largest capacity in the country so far.