Gail (India) Ltd, a prominent player in the Indian energy sector, is set to embark on a monumental investment endeavour, aiming to inject up to ₹50,000 crore into the establishment of a state-of-the-art ethane cracking unit in Sehore, Madhya Pradesh.
This ambitious initiative, revealed by sources privy to the matter, underscores Gail’s strategic push to bolster its foothold in the burgeoning petrochemical landscape, aligning with India’s escalating demand projections. The proposed facility, slated to boast a capacity of 1.5 million tonnes per annum, signifies one of the most substantial capital outlays envisaged by the state-run gas utility. It is envisioned as a pivotal component in Gail’s overarching strategy to cater to the escalating domestic demand for petrochemicals, which is anticipated to surge nearly threefold to $1 trillion by 2040. Ethane, an integral constituent of natural gas, will serve as the cornerstone of this transformative venture. An ethane cracker, the nucleus of the proposed unit, will harness cutting-edge technology to break down ethane into ethylene, a vital chemical precursor for an array of industrial applications, including plastics, adhesives, and synthetic rubber.
An informed official highlighted Gail’s bullish stance on the petrochemicals sector, emphasising the transformative potential of the envisaged facility. The project, still in its nascent planning phase, holds the promise of augmenting Gail’s existing petrochemicals capacity, potentially doubling its current 810 thousand tonnes per annum facility located in Pata near Kanpur, Uttar Pradesh. Engineers India Ltd, a renowned state-run entity, has been entrusted with the task of crafting a comprehensive feasibility report for the project, expected to materialise over the course of the next 5-6 years. Gail’s strategic vision also encompasses the importation of ethane from ethane-surplus nations, facilitated by robust pipeline infrastructure, in collaboration with key industry stakeholders.
In March, Gail took a significant stride towards actualising its vision by entering a tripartite memorandum of understanding (MoU) with Oil and Natural Gas Corporation (ONGC) and Shell Energy India. This collaborative effort seeks to explore avenues for ethane importation and the development of requisite infrastructure, underscoring Gail’s commitment to fostering a robust ecosystem for petrochemical innovation and growth. Amidst a rapidly evolving industrial landscape, Gail’s foray into the petrochemical’s domain signals a strategic diversification initiative. As India’s appetite for petrochemicals continues to burgeon, stakeholders anticipate a paradigm shift in the nation’s energy landscape, propelled by pioneering initiatives aimed at fostering sustainable growth and technological advancement.
