ONGC is keen on a partner which can bring technology and marketing support for its Dahej plant.
Moving beyond a supplier-buyer relationship, India has offered Kuwait a stake in Oil and Natural Gas Corporation's (ONGC’s) Rs 12,440-crore petrochemical plant at Dahej in Gujarat and Indian Oil Corporation's (IOC's) proposed chemical unit at Paradip.
The oil-rich nation's national oil firm, Kuwait Petroleum Corporation (KPC), has time and again spurned offers for stake in Indian refinery projects as it, like its Saudi counterpart, Saudi Aramco, wanted auto fuel distribution rights — not possible, considering only state-owned firms qualify for government subsidies.
Petroleum Minister Murli Deora met his Kuwaiti counterpart, Sheikh Ahmad Al-Abdullah Al-Ahmad Al-Sabah, on the sidelines of the XII International Energy Forum here yesterday and offered a stake in the mega petrochemical plants being built on the west and east coast, said Sunil Jain, joint secretary in his ministry.
ONGC is keen to get an overseas major who can either bring technology or marketing support for its Dahej plant that would be built by February 2012. ONGC holds 26 per cent stake in ONGC Petro-additions Ltd (OPaL), the special purpose vehicle formed for setting up the chemical complex at the Dahej special economic zone. Five per cent stake is with the Gujarat State Petroleum Corporation and state-owned gas utility GAIL India has 19 per cent. A foreign firm may be given 20-25 per cent.
“Kuwait said they would like to discuss the opportunity further,” Jain said.
The Dahej petrochemical complex would comprise global scale cracker and downstream polymer plants. OPaL will use C2-C3 (ethane and propane) compounds extracted from imported liquefied natural gas to make polymers. ONGC is looking for someone who can sell the polymers the plant makes. The plant would produce 1.1 million tonnes of ethylene, 340,000 tonnes of propylene, 135,000 tonnes of benzene and 95,000 tonnes of butadiene per annum. These products are used as source materials in the plastics industry.
KPC was also offered a stake in the 1-million tonne petrochemical plant that was split from the Rs 29,777-crore refinery at Paradip for building in future, he said. The chemical plant would be built after the 15 million-tonne-a-year refinery is commissioned in 2012 as IOC faced cash crunch in view of selling subsidised fuel.
IOC has for long been looking at equity partners in companies like Saudi Aramco and Kuwait Petroleum, who can supply crude oil to the Paradip refinery project in Orissa.
However, since the two declined offers, with the Saudi company doing so as late as last month, the petrochemical plant is now being offered.
Jain said Kuwait supplies 10 per cent of India's crude needs and New Delhi also expressed interest in setting up a fertiliser plant in the Gulf nation if it was allocated natural gas for the plant.
“Kuwait mentioned that it was short in gas and all the gas that it produced was being used for domestic industries,” he said.
New Delhi was looking at Kuwait and other oil-rich nations in the Gulf region for meeting crude oil demand of new refinery plants. India's refining capacity is to increase from 180 million tonnes to 250 million tonnes by 2012, he said.
Prime Minister Manmohan Singh's visit to Saudi Arabia had yielded an assurance from the world's largest oil exporter for increasing crude supplies from 25.5 million tonnes to 40 million tonnes a year by 2012.
Jain said Deora also met Georgina Kessel Martínez, Energy Secretary of Mexico, and expressed Indian companies' interest in participation in exploration and production in the Latin American nation.
Mexico, which currently does not allow ownership of oil and gas explored and produced by foreign companies, is looking at amending the present service contracts to give overseas firms incentives, he said.
ONGC Videsh Ltd, the overseas investment arm of ONGC, already has stakes in oilfields in Venezuela, Columbia and Brazil and was keen on expanding into Mexican waters.
