Page 42 - Plastics News December 2017

BUSINESS NEWS

IOCL to pick up stake in Paradip Saudi Aramco, Sabic sign deal

Plastic Park for $20 billion project

ndian Oil Corporation Ltd (IOCL) is likely to pick up audi Arabia’s two biggest companies signed an
Iequity in the special purpose vehicle (SPV) formed Sinitial agreement to build a plant to process crude
by the state government controlled Odisha Industrial oil directly into chemicals, a project the partners
Infrastructure Development Corporation (Idco) for the estimate will have a final value of some $20 billion.The
Plastic Park project proposed at Paradip. The plastic park memorandum of understanding governs the execution
is proposed over 120 acres of land. IOCL will join Idco of front-end engineering design for the integrated
as an equity partner bringing in its wake huge financial plant, Saudi Aramco and Saudi Basic Industries Corp.
strength and domain expertise in petrochemicals. A said. The planned facility will produce about 9 million
tonnes of chemicals and base oils annually and is
memorandum of understanding (MoU) was signed between expected to create 30,000 direct and indirect jobs,
IOCL and Idco at the 'Petrochemicals Investor Conclave
the companies said.
Construction is to start in the fourth quarter of 2019.
By 2030, the plant is expected to have a 1.5% impact
on Saudi gross domestic product. “It serves our joint
interests and the vision of the kingdom to develop
an economy that is not dependent on oil exports,”
Nasser said. The complex is expected to process
400,000 barrels a day of crude oil when it starts
operations in 2025, and will help the kingdom diversify
its economy away from crude exports, Aramco chief
executive officer Amin Nasser said. Saudi Aramco and
Sabic’s joint project will process crude oil directly
2017'. The pact was signed in the presence of Dharmendra into chemicals, a move that will help Saudi Arabia
Pradhan, Union minister of Petroleum and Natural Gas diversify its economy away from crude oil exports.
and Skill Development & Entrepreneurship and Sanjiv “We will take a decision on the final investment value
Singh, chairman of IOCL. According to reports IOCL is yet after conducting detailed studies in the second stage,
to take a call on the quantum of its stake in the plastic which will take two years,” Nasser said in the eastern
park SPV. “We will be working out the final details on city of Dhahran at a signing ceremony with Sabic CEO
our equity participation (in Paradip Plastic Park), Equity Yousef al Benyan. Saudi Arabia is prioritizing a more
participation would not be a bottleneck for the success of diverse output of petrochemicals to help wean its
the plastic park”, said the IOCL chairman. The proposed economy away from crude. Aramco, known formally
park has already received a grant-in aid of Rs 40 crore
form the Central government. After completion, the
park would host more than 100 MSME (micro, small &
medium enterprises) units of the polymer sector with an
employment potential generation for over 10,000 people.
Similarly, IOCL has also entered into pact with Institute of
Chemical Technology, Mumbai for exploring the feasibility
of establishing an ICT campus in Bhubaneswar. In a third
agreement signed at the conclave, the oil marketing PSU
and Haldia based MCC PTA India (MCPI) Ltd will establish a
continuous polymerization and yarn unit in a joint venture. as Saudi Arabian Oil Co., and Sabic want to produce
The proposed continuous polymerization would utilize chemicals that are used in plastics to tap growing
(PTA) from existing units of MCPI at Haldia and mono consumer-goods markets, particularly in Asia, and to
ethylene glycol from proposed plant of IOCL at Paradip. make plastics themselves.

Plastics News December 2017 42