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Reliance Industries AGM 2022 | To invest Rs 75,000 crore in expanding O2C capacities across value chains, says Mukesh Ambani

The conglomerate is committed to maximize Oil to Chemicals integration and convert its feedstock streams to high-value chemicals and green materials, said Chairman Mukesh Ambani

August 29, 2022 / 04:02 PM IST
Reliance Industries Ltd (RIL) chairman Mukesh Ambani

Reliance Industries Ltd (RIL) chairman Mukesh Ambani

 
 
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Reliance Industries Ltd (RIL)  will invest Rs 75,000 crore over the next five years in its  oil-to-chemicals (O2C) business and expand capacities in existing and new value chains, Chairman Mukesh Ambani said on August 29.

“For our O2C business, this was yet another year of superlative performance. It crossed Rs 5 lakh crore in annual revenues. The EBITDA crossed Rs 50,000 crore. We are committed to maximize Oil to Chemicals integration and convert our advantageous feedstock streams to high-value chemicals and green materials. I am pleased to share that over the next 5 years, we will invest Rs 75,000 crore and expand capacities in existing and new value chains,” Ambani said at the conglomerate’s 45th Annual General Meeting (AGM).

The investments will be in three areas:

  1. Polyester value chain - in this, RIL will build one of the worlds' largest single-train PTA plant of 3 MMTPA capacity at Dahej. It will also invest in a 1 MMTPA PET plant at Dahej, with both the PTA and PET plants targeted for completion by 2026.

  2. Vinyl chain - RIL will more than triple its existing capacity by adding world-scale plants at Dahej and Jamnagar in India, and also in the UAE. The conglomerate will aim to complete 1.5 MMTPA of feedstock integrated PVC expansion at Dahej and Jamnagar in phases by 2026. It will add capacities to make EDC and PVC at Ruwais, in the UAE, as part of Ta'ziz Chemical Zone. The joint venture with ADNOC and ADQ will target to full domestic demand of the region. With these expansions, Reliance will rank among the Top-5 producers of PVC globally, said Mukesh Ambani.

  3. New materials -The conglomerate will build in phases India's first and one of the world's largest Carbon Fibre plants at Hazira with a capacity of 20,000 MTPA, based on Acrylonitrile feedstock. It will start Acrylonitrile production next year and aim to complete the first phase of the carbon fibre plant in 2025.

Boosted by higher crude oil and product prices, Reliance's O2C business reported its best-ever quarterly performance in the first quarter of FY23 with an all-time-high revenue and earnings before interest, tax, depreciation, and amortization (EBITDA). The segment revenues increased by 56.7 percent on-year to Rs 161,715 crore.

In November, the company recalled plans to hive off its O2C business, which was a part of a larger plan to sell a 20 percent stake in the new entity to Saudi Aramco. At the time, RIL had said it will continue to be Saudi Aramco’s preferred partner for investments in India and collaborate with Saudi Aramco and SABIC for investments in Saudi Arabia.

In August 2019, RIL had first announced it was in talks with Saudi Aramco to sell a 20 percent stake in its O2C business. Then in September 2020, it unveiled a plan to create a separate entity for the business.

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Disclosure: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
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first published: Aug 29, 2022 04:02 pm
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