The Chatterjee Group (TCG), a US-based private equity firm, is exploring a partnership with Indian state-run companies for a major oil-to-chemicals project in Cuddalore, Tamil Nadu, according to Bloomberg sources.
TCG is currently in talks with Oil & Natural Gas Corporation (ONGC) and its subsidiary Hindustan Petroleum Corporation Limited (HPCL). The proposed venture, which is estimated to exceed $10 billion (Rs 839.48 billion), would see the state-run companies holding a 49% stake, while TCG, operating in India through Haldia Petrochemicals, would retain the remaining 51%.
A TCG representative was not available for immediate comment, and Haldia Petrochemicals, ONGC, and HPCL did not respond to requests for comment.
This potential investment aligns with India’s broader strategy to expand its petrochemical capacities, which are crucial for producing a wide range of products, from consumer goods to automotive components. Government estimates project that the demand for chemicals and petrochemicals in India will triple to $1 trillion by 2040.
Oil refiners, including Reliance Industries led by Mukesh Ambani, are increasingly focusing on petrochemicals rather than traditional fuels to meet the rising demand for specialty plastics and chemicals used in solar panels and electric vehicles.
TCG’s project aims to produce 3.5 million tons per annum (mtpa) of ethylene and propylene. According to a Reuters report in April, Haldia Petrochemicals CEO Navanit Narayan stated that the project is expected to become operational by 2029, with financial closure anticipated by the end of 2024.
Haldia Petrochemicals currently operates a 1 mtpa petrochemical plant in eastern India and is also developing the country’s largest integrated phenol project in West Bengal’s Haldia. Additionally, ONGC has recently received government approval for a $2.19 billion investment in its petrochemical unit, ONGC Petro Additions.
