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India To Be Soon Import Free On Phenol And Acetone

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September 14, 2018
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Presently, India is largely dependent upon imports for its requirements of phenol and acetone, two organic chemicals which are used in a wide variety of products such as laminates, automobile, paints, pharmaceuticals, rubber etc. The phenol consumption in the country has been growing at a CAGR of about 7% – 9%, from nearly 200,000 MT in FY2010-11 to 280,000 MT in FY2015-16. Against this backdrop of increasing demand, the import component has been rapidly rising at a CAGR of 15% between FY2010-11 and FY2015-16.

O n one hand, the domestic capacity is stagnant at 80,000 MTPA, and operating capacity is even lower At the same time, the capacity utilisation rate of domestic manufacturers has fallen from 100% in FY2010-11 to 50% in FY2015-16. As a result, domestic supply has been able to meet only 12% of domestic demand in FY2015-16 compared to 45% in FY2008-09. Domestic capacities have stagnated with two sub-optimal plants with around 30,000 – 40,000 TPA. Hence, the country’s demand has been majorly met by imports, thereby giving Deepak Nitrite a huge opportunity to cater to a ready market in the country, knowing benzene , a major raw material is in abundance in India The Company’s phenol capacity will help drastically reduce the import dependence for phenol.

Deepak Nitrite is on the cusp of a foray into petrochemicals intermediates business as it is setting up the country’s largest phenol and acetone plant in Dahej PCPIR. This project will have capacity of about 200,000 MTPA of Phenol while capacity of co-product Acetone will be 120,000 MTPA. Once the project is commissioned, it will trigger multiple new opportunities for Deepak Nitrite and significantly enhance its revenue stream.

T he Greenfield project, spread across 60 acres is progressing on schedule and approaching mechanical completion. It is expected to be commissioned in the last quarter of current financial year. The commissioning and operational teams are being recruited as preparations are underway for the next phase. Once completed, this mega project will help substitute the imports and enable the country to save foreign exchange while giving DNL a market leadership position for Phenol and Acetone in India.

Important Feature of mega green field Phenol Project:

  • One of the very few large private sector investments in recent times at INR 1400Cr.
  • The most effective phenol plant in the world – based on world leaders in technology providers (KBR)-Rs 700 Cr. Per one lac ton Phenol.
  • Least implementation time within 15 months – Project ahead of schedule by two months, shall go on stream in April 2018.
  • Project in line of Make-in-India – classical e.g. in chemical sector.
  • The project will leap frog the Company to big league club.

Phenol is used in manufacture of large range of commercial products. It is consumed in laminates, automobile, foundry, paints, rubber, surfactants, pharma and agro-chemicals among others, while Acetone is predominantly used in the production of pharmaceuticals, paints, adhesives and thinners. Local availability of phenol and acetone is expected to boost the production of derivatives and downstream intermediates, which will expand the overall market in the country and boost industry and economic growth.

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