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Mr. Siddhartha Mitra
Executive Director (Petrochemicals) Business DevelopmentIndian Oil Corporation Ltd.New Delhi
Currently heading the Petrochemical group of Indian Oil, Mr. Mitra, hasbeen with Indian Oil for more than three decades now and has richexperience in Process & Refinery Operations.
A Chemical Engineer from Jadavpur University, Calcutta and Post Graduatein Polymer Engineering, Mr. Mitra has been associated with the BusinessDevelopment group for the past 18 years now and is one of the chiefarchitects in spreading the vast business of Indian Oil in to Petrochemicals.
His responsibilities include Conceptualization of new projects, Feasibility /Detailed feasibility study for prioritized projects, Technology selection,M&A opportunities in brownfield projects and Marketing of petrochemicalproducts.
Building on Strengths Building on Strengths --
Advantage IndianOilAdvantage IndianOil
Building on Strengths Building on Strengths --
Advantage IndianOilAdvantage IndianOil
Petrochemical Conclave - 2013
Hotel Leela Kempinski, Gurgaon
March 2013
1
Agenda
About IndianOil
IndianOil’s Vision for Petrochemicals
IndianOil in Petrochemicals
Business Scenario
Future Plans
Summary & Conclusion
2
Agenda
About IndianOil
IndianOil’s Vision for Petrochemicals
IndianOil in Petrochemicals
Business Scenario
Future Plans
Summary & Conclusion
IndianOil at a Glance
34,233
Employees
21 Companies
Group
Companies
Rs 99,183 Cr
US$ 19.49 Bn
Total
Assets
» India’s largest commercial enterprise
» Highest-ranked Indian Company in Global Fortune 500 ranking : 83rd Rank
Net Worth
Rs 4,09,957 Cr
US$ 85.56 Bn
Rs 3,955 Cr
US$ 825 Mn
Net Sales
Net Profit
1.4.2012
Rs 57,877 Cr
US $ 11.38 Bn
3
Vision
Strategic Vision & Long term Planning behind sound base and strong growth
Visionary Progress
2009
New Shared
Vision
Formulated
1999
Vision
Formulated
A integrated
energy a
strong a
national
A major, diversified, transnational, integrated
energy company, with national leadership and a
strong environment conscience, playing a
national role in oil security & public distribution
Navratna status granted in 1997
Reconstituted Board started
functioning in 1999
Maharatna status granted in May 2010Maharatna status granted in May 2010
1st Maharatna Board Meeting held in
March, 20124
•10 out of 22 refineries in the country
•65.7 MMTPA capacity ( 31%)
Group Refining
•37,000 Touch Points (52%)
•66.8 million LPG customers
Marketing
•Over 10,909 Km length
•79 MMTPA capacity
Pipelines
•Lube formulations
•Technology dev.
•Patents (215)
•Catalyst dev.
•Petchem/nano-tech initiatives
R&D
• Operates world scale Naphtha Cracker unit
• Major player in petrochemicals in India
• Export to 45 countries
Petrochemicals
• Domestic:13 Blocks NELP(11),CBM(2)
• Over Seas:9 blocks Libya (3), Iran (1), Yemen (2), Nigeria (1), Gabon (1), & Venezuela (1)
Exploration & Production
• Co-promoter in M/s PLL
• LNG at Doorstep
• CGD
• Gas infrastructure (Storage / Transportation)
Gas
•Biofuel : Captive plantation
•Wind : 37.8 MW capacity
•Nuclear : Equity partnership
• Solar: Grid-connected 5 MW PV solar power plant , Solarization of Ros (103)
Renewable
Business Space
Downstream Major foray into …. Petrochemicals, Gas, E&P Wind, Solar, Nuclear Power and
Bio-fuels 5
IndianOil in Every Part in Every Heart
6
Only oil company
operating in every
part of India
Along, Passighat, Ziro
Leh, Kargil, Lahaul Spiti
North East
Islands Andaman, Nicobar, Lakshadweep
Himalayas
Retail Outlet at Boat house Kisan Seva Kendra outlets for extending rural reach
Modern XTRAcare ROs
Serving the Nation- Kashmir to Kanyakumari - Kohima to Kutch
7
Agenda
About IndianOil
IndianOil’s Vision for Petrochemicals
IndianOil in Petrochemicals
Business Scenario
Future Plans
Summary & Conclusion
Vision Statement: Petrochemicals Business
To be a dominant petrochemical player in India withfootprints in international markets, consolidation ofexisting business and diversification into niche, specialtychemicals & elastomer product segments.
8
Emergence of Emergence of National Oil CompaniesNational Oil Companies
Growing significance of National Oil and Petrochemical Growing significance of National Oil and Petrochemical companies. companies.
−− 10 years back, they were 11% of global total in petrochemicals. 10 years back, they were 11% of global total in petrochemicals. Today they have Today they have 22% share22% share
−− Located in resource rich regions or in high demand Located in resource rich regions or in high demand countriescountries
−− Integrated, access to Integrated, access to feedstocksfeedstocks
−− Aligned to the National Vision for development of the countryAligned to the National Vision for development of the country
9
Approach: Petrochemical Business
10
Refinery Synergy and Augment
Petchem capacity
To achieve economies of scale
Pooling of feed stock from refineries
Integration with refinery for Capex/ Opex optimization
Product Expansion and Consolidation
Consolidation in commodity products
Exploit potential in niche products
Exploit potential in Specialty Products
Technology Adoption
Adoption of the state of the art
technologies
Guarded Petchemtechnology
collaboration through JV
Drivers for IndianOil’s Petrochemicals
11
Utilization of surplus naphtha and stranded propylene from refineries
+
Utilization of other potential molecules from refineries such as n-paraffins, pet coke etc
+
No specialty chemicals producers in the country. Opportunity for offering full chain of petrochemicals
+
Opportunity for import substitution
+
Petrochemicals - Competitiveness Criteria
PARAMETER KEY OBJECTIVES
Size
Location
Technology
Integration
Capture economies of scale
Access to low cost feed stocks/ deficit markets
Cost advantage/ product differentiation
Synergies with adjacent facilities
IndianOil is ideally positioned for success in Petrochemicals Market
12
13
Petrochemicals – IndianOil’s Strengths
Best in Class Technology
Technology Selected for Each Plantprovides unique strengths in productquality & envelope
Marketing Strengths
# Trained Manpower
# Nationwide Presence
# User friendly Business Processes
Technical Services Backup
#Trained TS Engineers posted Nation wide
# Immediate Attention to Customer Issues
# Onsite Trials and New Grade Development
Application Development Center
#Latest Equipment#Trained, Quality Manpower#Extensive Application Devpt Work
Infrastructure Developed
Nationwide Network of web enabled:
#Channel Partners
#Warehouses
#Consignment Stockists
IT Enabled
Online Business Environment
Transparency & Ease of Doing Business
Transportation Infrastructure#Location Specific Transportation Contracts# Service Level Agreements for Delivery#Multimodal Transport for Overseas Exports#Robust Supply Chain for Regional Exports#Third party quality control
Fully Integrated - Access to feedstocks from IndianOil’s own Refineries
Front Runner Among PSU’s in Petrochemicals – Aspirations to be a dominant Player
14
Agenda
About IndianOil
IndianOil’s Vision for Petrochemicals
IndianOil in Petrochemicals
Business Scenario
Future Plans
Summary & Conclusion
Forward Integration: Petrochemicals
Already India’s second largest petrochemical player
Value addition to downstream business through sizeable investment of over Rs 20,000 crore
•Polyethylene
•Poly-propylenePolyolefins
•PTA
•LABAromatics
Surfactant F/s
•MEG
•DEG
•TEGGlycols
Pro
du
cts
pro
file
LAB at Gujarat
(Rs. 1,112 crore)
• 120 TMTPA capacity
plant commissioned
in 2004
• 24% capacity of the
Indian industry
Px/PTA at Panipat
(Rs. 4,081 crore)
• 553 TMTPA PTA
capacity plant
commissioned in
2006
• 14.3% capacity of
the industry
Polymer/Glycol
(Naphtha Cracker at Panipat)
(Rs. 15,508 crore)
• Commissioned in 2010
• Polymer• 1250 TMTPA Capacity
• 19.2% Capacity of the Industry
• Glycol• 325 TMTPA Capacity
• 25 % Capacity of the Industry
Export: LAB to 20 countries, Polymer to 31 countries & Glycols to 9
countries 15
Indian Oil Projects: Technology Excellence
LAB at Gujarat Improved product quality due to:
- High 2-phenyl alkanes
- Lower benzene content
- Better color performance
Adoption of fixed bed catalyst based Detal Process resulting in higher product yield
PX/PTA at Panipat High PX yield due to:
- Adoption of upgraded adsorbent /catalyst
- Adoption of optimized secondary & tertiary processes
Upgraded PTA technology resulting in reduced energy consumption
Naphtha Cracker Complex at Panipat Cracker Unit
- Increased olefins yield
- Reduced specific energy consumption
Polymer Units based on solution/slurry processes resulting in:
- Lower transition time between grades
- Better stability of products
- Better stereo regularity of products
Polymer Technologies adopted targets production of all grades
16
IndianOil Petrochemicals – Promoting Investment
RefineryRefinery NCU/PX C2/C3 d/s,
PTA units
WarehouseWarehouseProcessing Processing
unitFinished Goods
End to End Infrastructure
17
PADC is the interface between Plant, Marketing & Customers
State of Art Technology Centre with sophisticated Plastic Processing & Characterisation equipments
Product Application & Development Centre - PADC
PADC
Technical Support to Customer
New ApplicationDevelopment
New GradeDevelopment
Developed and Introduced 2 High Performance Grades 1110MAS, 2120MC
+
Developed HD Grade for Tarpaulin Application produced from Swing Plant
+
USFDA Approval obtained for 19 PE/PP Grades for Food Applications and 7 for RoHE (Reduction of Heavy Substance)
+
Developed recipes for sourcing cost effective additives from domestic market for TQPP and LLDPE
+
Stringent Quality monitoring done to deliver high quality grades
+
18
Petrochemicals - Applications
15 OEM approvals obtained for Propel brand of PE and PP
19 CFTRI approval obtained for Propel brand of PE and PP
grades for general food contact application
(conforms to USFDA and BIS standards)
19
Propel– Global Presence
Exports - Petrochemicals
Angola Indonesia Mexico Peru UAE
Australia Israel Netherlands Phillipines USA
Bangladesh Italy Nigeria Portugal Vietnam
Belgium Japan Norway Qatar Yemen
China Kenya Oman Saudi Arabia Thailand
Ghana Malaysia Pakistan South Africa Turkey
South Korea Spain Sri Lanka Syria Nepal
20
21
Agenda
About IndianOil
IndianOil’s Vision for Petrochemicals
IndianOil in Petrochemicals
Business Scenario
Future Plans
Summary & Conclusion
Markets in North and East India have a lot of unfulfilled potential
Target Pan India Presence with special focus on North & East Markets
Develop Neighbouring markets – Pakistan, Nepal, Bangladesh
22
IndianOil’s Vision
23
Presence of a proximate Polymer Plant
Market Growth – Proximate to a Major Plant
IndianOil Plant will
promote growth in
Northern Region
23
31%
22%
26%
21%
Population Vs Petrochem Demand
24Source: IOCL Analysis
21%
11%47%
21% Demand
Popln
•Regional Imbalance
•Increase Manufacturing
Capacity in North & East
50% 50%
Development of Eastern India
8%
22%
32%
1980 2000 2010 2020 2040
West of the
Kanpur-
Chennai line
East of the
Kanpur-
Chennai line
Chennai
Kanpur-
IndianOil’s Paradip Refinery will be a major driver of growth in Eastern India
25
Focus – The North Indian Trading Zone
•Outlined Tear Drop Shape is home to
800 million people in 3 countries!
•Youngest Population – Av Age 25 yrs
•Low per capita consumption of
Petrochemicals – scope for growth
•Adequate supply – new plants
•Borders and Trade Opening up via
Road and Rail routes
•Future growth hotbed
27
Agenda
About IndianOil
IndianOil’s Vision for Petrochemicals
IndianOil in Petrochemicals
Business Scenario
Future Plans
Summary & Conclusion
Petrochemicals – Upcoming Projects
Indian Synthetic Rubber Ltd (ISRL)
JV PARTNERS:
IOC;
M/s Taiwan Synthetic Rubber Corp (TSRC);
M/s Marubeni, Japan
JV PARTNERS:
IOC;
M/s Taiwan Synthetic Rubber Corp (TSRC);
M/s Marubeni, Japan
Feedstock:
Styrene and Butadiene
Capacity :
120TMTPA
Expected Completion:
Q3 2013
Cap Ex:
Rs 890 Crs.
Feedstock:
Styrene and Butadiene
Capacity :
120TMTPA
Expected Completion:
Q3 2013
Cap Ex:
Rs 890 Crs.
28
Petrochemicals – Upcoming Projects
Acetic Acid Project at Baroda
JV PARTNERS:
IOC;
M/s BP Chemicals, UK
JV PARTNERS:
IOC;
M/s BP Chemicals, UK
Feedstock:
Carbon Mono-oxide ( produced from petcoke gasification) & Methanol
Capacity :
1000 TMTPA
Expected Completion:
2016-2017
Cap Ex:
Rs 7900 Crs.
Feedstock:
Carbon Mono-oxide ( produced from petcoke gasification) & Methanol
Capacity :
1000 TMTPA
Expected Completion:
2016-2017
Cap Ex:
Rs 7900 Crs.
29
Ongoing projects and Investments
30
PLANT LOCATION CAPACITY EXPECTED COMPLETION
New Plants
PP Plant Paradip 680 TMT 2015-16
Acrylic Acid/Acrylates
Oxo Alcohols
Gujarat
Gujarat/Barauni
130 TMT
110 TMT
2016-17
Cumene/Phenol Haldia/Barauni 280 TMT 2016-17
Revamps
LAB Gujarat 42 TMT* 2015-16
PX/PTA Panipat 100 TMT* 2016-17
Naphtha Cracker Panipat 250 TMT* 2017-18
20701
3729135397
In C
rs
2012-13 2015-16 2012-13 2015-16
Investment (Crs)
Turnover (Crs)
*Incremental Capacities
15158**
**Apr’12-Feb’13
31
Alternate Feedstock Options for Petrochemicals
Raw C4/C5 streams from Naphtha Cracker – significant potential to reduce
cash cost of production of ethylene from Naphtha cracker by adding value to C4/C5
streams that are traditionally hydrogenated and recycled back to supplement cracker
feed
Upgradation of Pyrolysis Gasoline from Naphtha Cracker – potential to
recover styrene, mixed xylenes, toluene, naphthalenes which are petrochemical building
blocks
Petcoke/Coal/Residue Gasification & downstream based on syn gas
production
Deep Catalytic Cracking (DCC) - Selective cracking of feed stocks to maximizelight olefins, recovery of ethylene from dry gas & propylene from LPG. e.g IOCL’s
INDMAX technology
Utilization of surplus Coker naphtha – olefins production while maximizing
propylene. e.g. IOCL’s INDALIN technology
Ethane recovery Unit (for CDU, COKER Off gases) for feed to steam cracker
Propane Dehydrogenation Unit (PDH) for on-purpose propylene production
32
Agenda
About IndianOil
IndianOil’s Vision for Petrochemicals
IndianOil in Petrochemicals
Business Scenario
Future Plans
Summary & Conclusion
Summary & Conclusion
• Significant opportunity in domestic and neighboring market
• Petrochemical Projects would aim to achieve competitiveness by:
• Leveraging existing strengths in refining, marketing & supply chain
• Employing state of art technologies
• Locating plants close to low cost feedstock/ demand centres
• Building world scale capacities
• Low cost revamps/Creation of grassroots integrated complexes
• Exploiting synergies available by integration with refineries
• Emphasis on C4/C5 feed streams available from cracker
• Enter into Niche segments in polymers/specialty chemical/elastomers
• Development of Alternate sources of petrochemical feedstock like Coal/Residue
gasification, MTO/MTP, Deep Catalytic Cracking etc.
• Explore opportunities for participation in international projects with competitive
feedstock pricing and bringing the end product to India
• Sustaining leadership in petrochemical business amongst PSUs33
34
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