Recently, the chief executive officer and chairman of Oil & Natural Gas Corp. Ltd, Arun Kumar Singh announced that the company is thinking of investing around $20 billion to set up two petchem (petrochemical) plants. However, ONGC has not decided whether it will set up two plants of petrochemical in partnership with other companies or independently. But it is almost certain that the project of setting up two petrochemical plants will start in this fiscal year. According to the Chairman and CEO of ONGC, the cost of establishing a petrochemical plant will cost around $10 billion, therefore, Arun Kumar Singh announced $20 billion for two plants of petrochemical. We have shared more in-depth details of this significant development announced by ONGC. Drag down the page.
The chairman of Oil & Natural Gas Corp. Ltd, Arun Kumar said we may do it on our own or in a JV (joint venture). It depends on economics and what happens in respective states,” Currently, the company is looking at sites to set up the planned projects. As mentioned, Singh said the petchem plants will likely start in the current financial year. Demand for petrochemicals, fertilizers, pharmaceuticals, and the building blocks for plastics, is expected to remain strong due to their wide range of uses throughout the industries, including automotive, electronics, and construction. Strengthening the chemicals business will also help the state-run oil explorer ONGC improve profitability in the long run and cut its reliance on the volatile oil market.
Arun Kumar Singh added that the demand for oil is expected to increase in India till 2040-45. Therefore, the company wants to prepare us for a new world. Singh said, “We feel that our petrochemical footprint has to go up to accommodate our product in India, in the new world.” Furthermore, he said for the next 10-15 years, we see commodity petrochemicals picking up very strongly. So, you have both sides: you have polypropylene side, then you have ethylene side,”
Hence, ONGC is focusing on achieving increased recovery chemicals from crude in the range of 50-70% compared to conventional refining. Oil Natural Gas Corp Ltd. observed in its annual report for fiscal year 2023 that petrochemicals demand is likely to remain high and will be a key driver of oil and gas demand in the future. However, ONGC is associating with other companies to explore opportunities in the O2C (Oil-to-chemical) business, petrochemicals, and refining.