IOCL signs MoU with Odisha Govt. for Rs. 61,000 Cr. Petrochemical Complex
IndianOil Corporation Ltd. (IOCL) has signed a Memorandum of Understanding (MoU) with Odisha government for setting up Rs. 61,077 crore petrochemical complex at Paradip. The investment for development of this complex was approved by the company in March 2023.
India’s Largest Petrochemical Project: IOCL’s Mega Investment in Odisha
IOCL’s upcoming petrochemical complex will be India’s largest dual-feed naphtha cracker project and the company’s largest investment at a single location. This naptha cracker is expected to be commissioned by 2029, as per Mr. AS Sahney, Chairman of IOCL.
Naptha cracker is a key component in petrochemical projects which converts naptha, obtained from petroleum, into compounds used to synthesise polymers, plastics and synthetic fibres. The naptha cracker at this project will be fed by IndianOil’s Paradip refinery.
Indian Oil’s Paradip Project to Cut India’s Reliance on Imports
As of now, India is a net importer of chemical and petrochemical products, with annual imports estimated at USD 88.6 billion (Rs. 7.57 lakh crore). In fact, imports cater to about 40-45% of India’s chemical and petrochemical product requirements. Therefore, IndianOil’s Paradip petrochem project, which represents a major investment in this sector, gains national importance.
Paradip’s petrochemical complex will produce wide range of petrochemicals including Phenol, Polypropylene (PP), Isopropyl Alcohol (IPA), High-Density Polyethylene (HDPE), Linear Low-Density Polyethylene (LLDPE) and Polyvinyl Chloride (PVC). These products will be used as raw materials for chemical sectors like plastics, pharmaceuticals, agrochemicals, coatings and adhesives, reducing import dependency. As per Mr. Hardeep Singh Puri, Union Oil Minister, who was present at the MoU signing, IndianOil’s Paradip petrochem project is expected to cut import costs of over Rs. 30,000 crore every year.
Further, IOCL’s Petrochemical complex is expected to create over 1 lakh direct and indirect job opportunities.
Commenting on this development, CM of Odisha, said that IndianOil’s Paradip petrochem project targets “…human resource development, infrastructure enhancement, and [growth of] economic opportunities” in Odisha.
Substantial Growth Opportunities in Petrochem Sector – Union Oil Minister
At the MoU signing, Mr. Hardeep Singh Puri explained, “…the per capita consumption of various chemical products [in India] is significantly lower compared to developed economies…this gap [in consumption] offers substantial space for demand growth and investment opportunities [in the petrochem sector]”. He added that as of now, India’s chemical and petrochem market is valued at Rs. 18 lakh crore, which is expected to reach Rs. 85 lakh crore by 2040.
About IOCL: Indian Oil Corporation Limited is an Indian Government-owned oil and gas producer and explorer. Headquartered in New Delhi, IOCL is a ‘Maharatna’ Public Sector Undertaking (PSU), under the Ministry of Petroleum & Natural Gas (MoPNG).