Gail (India) Ltd and Indian Oil Corporation Ltd have signed an MoU for cooperation in the area of petrochemicals. The proposed joint venture company will explore the possibility of setting up a cracker complex, including downstream derivatives, at Barauni in Begusarai district of Bihar. The project is being set up with an eye on the growing market for polymers in India.
A joint working committee consisting of two representatives from each company will be formed to undertake the techno-economic feasibility study of the project, including feedstock (naphtha and natural gas) management.
Gail will assess the prospect of natural gas availability from the Krishna-Godavari basin, including the potentiality of rich gas to be used as part of the feedstock for the project and work out the modality for distribution of the same from KG basin to the project site.
Indian Oil will assess the prospect of availability of off-gas and naphtha not only from its Barauni refinery but also from its other operating refineries, to be used as the predominant feedstock for the project, and work out the modality for positioning the same to the project location.
Gail and Indian Oil will subsequently develop appropriate agreements for supply of the gas to the JV after it is formed.