Page 38 - Plastics News April 2021

Business news

ONGC invites bids for buying KG IOCL awards EPCC contract to

offshore gas Technip

il and Natural Gas Corporation (ONGC) has floated the ndian Oil Corporation
Otender for prospective buyers to bid for gas supplied I(IOCL) has awarded a
from its KG-DWN-98/2 field located in the east coast Krishna significant engineering,
Godavari offshore field. ONGC will supply two million procurement, construction
standard cubic meters per day (mscmd) gas from the field and commissioning (EPCC)
to the Odalarevu onshore terminal in Andhra Pradesh, and contract to Technip
buyers can book contracts for three to five years, starting Energies to upgrade the
June 30 Bidders will have to quote prices linked to the Barauni Refinery in India.
contemporary rates of Brent crude oil, but ONGC will sell The Barauni refinery is
the gas at the government determined ceiling tariff for the situated on a 3.59km² site
fuel for difficult fields, which currently stands at $3.62 per in the Begusarai district
million British thermal units (mBtu). First gas production of Bihar, approximately
from ONGC’s KG-DWN-982 deep-water project commenced 140km away from Patna.
on March 5, 2020. The field is expected to touch the peak IOCL is undertaking BR9 Expansion Project with an
production of 15 mscmd by FY24. Domestic gas output fell investment of $1.9bn (£1.4bn) to increase the refinery’s
2.8% y-o-y to 31,168.4 million standard cubic meters in
FY20, reversing the growth trend recorded since FY18 amid crude processing capacity from six million tonnes per
the ageing of existing fields and muted response from the annum (Mtpa) to 9Mtpa. Under the contract, Technip
industry to take up new projects. Production has, however, Energies will install a new once-through hydrocracker
shown recent signs of revival with the commencement of unit (OHCU) with capacity of one million metric tonnes
production from Reliance Industries and BP’s ultra-deep- per annum (MMTPA), a fuel gas treatment unit and
water field in the KG D6 Block on the east coast of India. the associated facilities. Together with downstream
refinery units, the OHCU will help produce fuels and
petrochemicals while complying with India’s Bharat
Stage (BS)-VI quality standards. Technip Energies India
business unit senior vice-president Bhaskar Patel said:
“This award demonstrates our long-term commitment
in India and substantially consolidates our positioning
in High Operating Pressure projects. It also strengthens
our position as a leading provider of key projects to the
major players in India’s domestic energy sector.” The
Barauni refinery, which was built in 1964, underwent
multiple expansions and upgrades to reach a crude
processing capacity of 6Mtpa in 2002.Upon completion
of the latest expansion project in 2023, the refinery will
also produce petrochemicals such as polypropylene.
The ceiling price of domestic gas is fixed by the government Besides, the project will involve the installation of two
every six months, and in the latest revision on March-end, new 80 tonnes per day (tpd) sulphur recovery units, a
rates were kept unchanged at the current all-time low rate new 304,000tpa isomerisation unit, a new 200,000tpa
of $1.79/mBtu. However, the ceiling price for gas to be polypropylene (PP) unit, a new 390,000tpa LPG
produced from difficult fields which have higher pricing treatment unit, among others. According to Technip
and marketing freedom, had been cut by 10.8% to $3.62/ Energies, the value of a significant contract ranges
mmBtu. More than 95% of the gascurrently produced by
ONGC are sold at government determined rates. between €50m and €250m.

Plastics News April 2021 38