ONGC contemplates buying SPIC''s petrochemicals buisness

New Delhi/Chennai: Oil and Natural Gas Corporation Ltd may undertake a due diligence exercise towards acquiring the petrochemicals business of SPIC (Southern Petrochemical Industries Corporation Ltd), according to sources.

According to sources, the company was considering a complete buy out of SPIC's petrochemical project, which has got stuck after SPIC was involved in a legal wrangle with Chennai Petroleum Corporation Ltd. The two companies had a joint venture to execute a similar project.

According to sources, MRPL, in which ONGC has a 51 per cent stake, has been asked by the Petroleum Ministry to explore investing in SPIC Petrochemicals Ltd, a subsidiary of SPIC's, set up to execute the petrochemical project. SPIC Petrochemicals was set up to put up a purified terephthalic acid (PTA) and polyester filament yarn (PFY) project at Manali, north of Chennai.

There have been several attempts to revive the project, with almost Rs1,000 crore of funds locked up in the project.