ONGC looking to buy rest of ONGC Petroadditions: report
11 Sep 2019
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State-owned explorer Oil and Natural Gas Corporation Ltd (ONGC) plans to buy the remaining stake in petrochemicals company ONGC Petro additions Ltd (OPaL), and launch a public offer if it fails to find a strategic partner for it.
OpaL, which is majority-owned by ONGC, is primarily a polymer manufacturer, a chemical compound used in everything from textiles to plastics and packaging.
A Reuters report citing Subhash Kumar, ONGC’s director of finance as saying that the alternative is either to convert OPaL into a subsidiary by converting share warrants and debenture into equity or else merge OPaL with ONGC.
ONGC Petro additions Limited (OPaL), is a joint venture company promoted by ONGC and co-promoted by GAIL and GSPC.
OPaL has set up a grass root mega petrochemical complex at the Dahej Petroleum, Chemicals and Petrochemicals Investment Region/Special Economic Zone (PCPIR/SEZ0 in Gujarat.
The complex's main dual feed cracker unit has the capacity to produce 1,100 KTPA of ethylene, 400 KTPA propylene. The associated units consist of pyrolysis gasoline hydrogenation unit, butadiene extraction unit and benzene extraction unit. The Polymer plants of OPaL has 2X360 KTPA of LLDPE/HDPE Swing unit, 1X340 KTPA of dedicated HDPE and 1x340 KTPA of PP. The project commenced production in March 2017.
OPaL is poised to become a key player in the growth of the polymer industry, because it has all the essential ingredients to become one of the best performing operators in the global petrochemical industry. Moreover, to utilize the advantage of this highly competitive and dynamic market, OPaL synergises with the strengths of its promoters. OPaL has the combine advantages of adequate indigenous feedstock supplies, talented manpower, ready market and above all, a better and brighter domestic market.
The demand for polymers in India is huge and is expected to further rise with the growth in GDP. India will continue to be in deficit of Polyethylene in the foreseeable future. Moreover this also works as a perfect downstream integration for ONGC-the key promoter who will be supplying the feedstock required for this project from its Hazira, Uran and Dahej facilities.
