BP, IOC shape petrochem venture for Gujarat

It’s destination Gujarat. The UK-based British Petroleum (BP) and Indian Oil Corporation on Wednesday entered into a memorandum of understanding to set up a 50:50 joint venture acetic plant in Gujarat.

The one million tonne per annum acetic acid plant will come up with associated gassification facilities for production of synthesis gas.

Acetic acid is used in petrochemicals and paints, apart from other products.

The two companies are waiting for the feasibility report that is under way to confirm the exact details of the project, which is expected to be commissioned in 2015.

The joint venture will derive its technical prowess from the latest Cativa XP from BP while petroleum coke feedstock will be used from Indian oil.

Indian Oil had recently commissioned a coker unit with one million tonne petcoke capacity at its Gujarat refinery.

The acetic acid will be a good opportunity for enhanced value addition, besides providing a window for import substitution.
Earlier this year, BP acquired a 30% stake in 23 oil and gas blocks owned by Reliance Industries in a $7.2-billion deal.
According to company officials, BP’s deal with Indian Oil will not have any impact on its pact with Reliance Industries, as the agreement with the latter does not include any foray into acetic acid business.