Financial Express, India: Petro-hubs will make India global player’: Shell report says each hub could have 30-60 million tonne refining capacity: 12 January 2006
ANUPAMA AIRY
Posted online: Thursday, January 12, 2006 at 0000 hours IST
NEW DELHI, JAN 11: Shell Global Solutions International has recommended setting up of two or three export-oriented integrated refining cum petrochemical hubs in India. Each hub could be built around a 30-60 million tonne per annum (mtpa) refining capacity along with two world scale ethylene crackers in phases.
These super-sites, says Shell, should be set up as world class facilities similar to the existing international hubs like the Jurong Islands in Singapore or the Taiwanese Mailiao where the famous Formasa Plastic Hub is based.
Shell Global was appointed by Indian Oil Corporation on behalf of the petroleum ministry to carry out a study on making India an investment destination as a refinery hub of South and South East Asia.
According to Shell, the stand alone export-oriented refinery concept is not a feasible one. It has instead recommended setting up of an integrated refining cum petrochemical hubs. Each such site, in addition to a refinery and Ethylene cracker, could also house derivatives plants like styrene and the next level of chemicals and downstream industries like plastic, tyre etc.
A large scale power station fired on cheap resources like coal/coke besides other support services such as maintenance, port facilities and fabrication could be shared amongst different industries in the hub.
What The Study Says
• The standalone export-oriented refinery concept is not a feasible one
• Set up instead integrated refining cum petrochemical hubs
• A large scale power station fired on cheap resources like coal/coke while other support services could be shared amongst different industries in the hub
• Best export opportunities exist in Asian countries including Indonesia, Bangladesh, Sri Lanka, the Philippines and Pakistan
• Hubs could house derivatives plants and the next level of chemicals and downstream industries
Best export opportunities from such Indian super-sites, as per the Shell’s study, exist in Asian countries including Indonesia, Bangladesh, Sri Lanka, Philippines and Pakistan. This is because larger economies like China, Korea and Japan have already planned to be self sufficient and so India should focus on countries with no structural self-sufficiency. Limited opportunities also exist for export to the Western Europe and USA.
Shell has proposed two broad strategies that can be followed by the government for setting such hubs in the country. The first is the free market option where a maximum of two hubs with average size of 30 mtpa can be developed. Here, the government would have a more national focus, leaving the management to individual companies providing fiscal support for select products rather for industrial development.
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