IndianOil to Establish £90m Synthetic Rubber Facility

IndianOil, the largest company in India in terms of sales and profit, intends to establish its first styrene butadiene rubber (SBR) facility. This plant, located at Panipat in the north of India and to be built at an investment price of Rs 7.61 billion (£90.55 million), will be 48 per cent owned by IndianOil. The company plans to offer two further investors respective shares of 32 per cent and 20 per cent in the 120,000 tonne per annum emulsion SBR project.

In terms of cost, IndianOil will contribute Rs 1.82 billion (£21.66 million) towards the SBR project, and spend a further Rs 3.07 billion (£36.53 million) on the 130,000 tonne per annum butadiene extraction unit. Four grades of emulsion SBR (two oil extended and two non-oil grades) will be produced in the plant. Due to the fact that India imports its entire SBR requirement, the company foresees no difficulty finding a market for the grades.

The SBR will reportedly be produced by the co-polymerisation of butadiene and styrene in a weight ratio of 3:1 in the presence of catalysts, chemicals and stabilisers. While the butadiene feedstock (about 72,000 tonne per annum) will come from the Panipat refinery through an extraction unit, the other feed stock, —styrene (about 22,000 tonne per annum), will be imported.

India’s estimated consumption of SBR during 2007-08 is estimated to be 110,000 tonnes, with the bulk of demand coming from the country’s automotive industry, which currently accounts for about 92 per cent of India’s SBR consumption. Production of both cars and two-wheeled vehicles is projected to double during by 2014-15.