APIC ’10: India’s OPaL eyes IPO by end 2011

14 May 2010 03:15  [Source: ICIS news]

By Prema Viswanathan

MUMBAI (ICIS news)--India’s ONGC Petro-additions Ltd (OPaL) expects to go in for an initial public offering (IPO) for its cracker and derivatives complex in Dahej, Gujarat, by the end of 2011, the company’s CEO said on Friday.

“The procedure for an IPO will start in a month or so and it will take over a year to complete the process,” said PK Johri, CEO of OPaL, on the sidelines of the Asia Petrochemical Industry Conference 2010 in Mumbai.

The company is currently evaluating how much equity it should offer through the IPO to the public and how much to strategic investors, he said.

“We are looking at a total offering of 50%, but haven’t decided yet how much of that should be offered to strategic investors,” he said.

Besides ONGC (Oil and Natural Gas Commission) which holds 26% stake, OPaL’s current shareholders include Gail (India) with a 19% stake, and Gujarat State Petroleum Corp (GSPC) that has a 5% share.

The company’s 1.1m tonnes/year cracker will use dual feedstocks – ethane and naphtha. Units downstream of the cracker include a  1.06m polyethylene (PE) facility, a 340,000tonne/year polypropylene (PP) plant, and a 95,000tonne/year butadiene unit.

“The dual feed will give us a lot of flexibility and enable us to optimise the access to both gas and naphtha that we have through ONGC,” said Johri.

The company had earlier looked at putting up a styrene butadiene rubber (SBR) plant but have now dropped it. “We will now sell the butadiene into the merchant market instead of using it captively,” said Johri.

Johri was confident that the company would be able to meet the targeted start up deadline of end 2012, as “we are well ahead of schedule.”

Other major Indian PE and PP producers include Reliance IndustriesHaldia Petrochemicals , Indian Oil Corp and Gail India.

The two-day APIC conference ends on 14 May.

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By: Prema Viswanathan
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