Indian Oil Corporation (IOC), the most profitable public sector company in the country, plans to invest 4500 crore rupees to manufacture styrene monomer, of which India is a major importer. The new petrochemical facility would be established at the company’s refinery & petrochemical complex at Panipat, Haryana. The project, which is expected to manufacture 3.87 lakh metric tonnes of styrene monomer per year has been granted stage-1 approval and expected to be ready by 2026-27.
“Availability of styrene domestically is expected to accelerate the growth of downstream industry and create employment opportunities,” said the company in a statement.
Styrene is used to produce polystyrene, paints, coatings/acrylics, and the current demand is around 9 lakh metric tonnes per annum, which is entirely met through imports from Southeast Asia and West Asia. The project would prove to be a major boost to the Modi government’s AtmaNirbhar Bharat Abhiyaan initiatives, as it would reduce dependence on foreign countries for the crucial material whose demand is expected to rise exponentially in the coming years.
IOC is the largest oil refiner in the country and in the last few years it has invested in many mega projects in order to reduce the country’s dependence on imports in the petrochemical sector. Previously it invested heavily to revive and expedite the $44 billion Ratnagiri Refinery and Petrochemicals (RRPCL) project. The RRPCL project which is also termed as West Coast Refinery will be the largest Greenfield Oil Refinery project in the World. Saudi Aramco and Abu Dhabi National Oil Company (Adnoc) will hold a 50 per cent stake in the project. The other major stakeholders are Indian oil majors like Bharat Petroleum Corporation (BPCL), and Hindustan Petroleum Corporation (HPCL). The project which is expected to spread in an area of 14,675 acres of land was stuck due to land acquisition problems.
India has the fourth-largest oil refinery capacity in the world after United States, China, and Russia. The US has a refining capacity of 841 MTPA while China has a capacity of 589 MTPA. China alone accounts for 41% of Asia’s production capacity while Russia has a capacity of 282 MTPA. India has 266 MTPA production capacity and may soon overtake Russia. The West Coast refinery, which will increase the capacity by 60 MTPA, is expected to become functional by the early 2020s while India is set to overtake Russia before it becomes operational.
The petrochemical sector has been a major focus since the Modi government came to power owing to India’s heavy dependence on imports in the sector. Every year, India shells out foreign exchange worth more than $100 billion oil petrochemical sector imports. Thus, the government is not only expanding renewable energy generation exponentially but also improving the efficiency of existing petrochemical PSUs. For instance, the government has decided to privatize BPCL – one of the largest oil refining companies in India, which accounts for 15% of the country’s refining capacity. It has a market value of more than 1 lakh crore rupees and the government has an above 50% stake in the company. The privatization will bring lakhs of crores of rupees to the government coffers, and improve the efficiency of the company.
The improvement in the petrochemical sector would generate large-scale employment and reduce dependence on imports.
