Reliance plans over $20bn capex by 2012

12 June 2007 15:45  [Source: ICIS news]

By Divya Chowdhury

MUMBAI (ICIS news)--India’s Reliance Industries Limited’s (RIL) will be spending $20-23bn (€15-17.25bn) over the next five years to expand in its core businesses, Nikhil Meswani, executive director at the company told ICIS news late on Monday.

Of this, $6bn would be invested in a refinery at Jamnagar, Gujarat, which is slated for commissioning by December 2008, said RIL.

A new 2m tonne/year cracker and derivatives complex would have a capital expenditure of $3bn, while $8-9bn would be invested in the oil and gas business, he said.

RIL’s venture into the retail business would involve an investment of $5bn, Meswani added.

Completion of these projects should help the company double its turnover by 2010, he said.

The cracker complex, which would principally produce ethylene, is scheduled to come onstream in 2010-2011, he added.

Meswani stressed that the cracker, which would use the offgases from RIL’s two refineries at Jamnagar as feedstock, would be as competitive as gas-based crackers in the Middle East and that this would be possible without any subsidy on feedstocks.

“RIL would be able to deliver products from the new cracker at a cost lower than any producer in the Middle East,” Meswani said.

He added that one of RIL’s key challenges was to develop value-added products in the C1-C8 chain and “execute the projects ahead of time at the lowest possible cost and place the product without disrupting the market.”

The completion of the new refinery would provide Reliance with new feedstocks to develop its petrochemicals portfolio. For instance, 5-6m tonnes/year of petroleum coke would be available in the future, he said.

“This is as good as coal on the ground with lower ash content. There are several possibilities,” Meswani added.

($1 = €0.75)

 

By: Divya Chowdhury
+65 6780 4359

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