Haldia Petrochemicals Ltd (HPL), a subsidiary of The Chatterjee Group (TCG), is planning to develop a significant oil-to-chemical project in Cuddalore, Tamil Nadu, with an investment exceeding $10 billion. The facility is designed to produce 3.5 million metric tons per year of ethylene and propylene, essential feedstocks for various chemical products. HPL aims to achieve financial closure by the end of 2024 and commence operations between 2028 and 2029.
This strategic initiative seeks to capitalize on India’s growing demand for specialty chemicals, many of which are currently imported, thereby enhancing profit margins through domestic production. HPL currently operates a 1 million tpy petrochemical plant in eastern India and is constructing the country’s largest integrated phenol project at Haldia. In 2021, the company acquired a defunct oil refinery project in Cuddalore from Nagarjuna Oil, which had been inactive since 2011 due to cyclone damage.
The expansion into southern India is strategically significant, as the region lacks large-scale petrochemical facilities to meet its industrial needs. By establishing a presence in Cuddalore, HPL aims to tap into the economically developed markets of southern India, reducing reliance on imports and supporting the nation’s expanding economy. The project is expected to contribute to meeting the increasing demand for products ranging from plastics to paints and chemicals such as monoethylene glycol, used for making textile fiber and polyester resins.
HPL’s CEO, Navanit Narayan, emphasized the importance of this project, noting that India’s petrochemical consumption is about one-third of the global average, indicating significant growth potential. He stated, “Our assessment is that India needs a cracker of global scale every 18 months because we are growing at more than 7%-8% annually as an industry.”
This development underscores HPL’s commitment to strengthening India’s petrochemical infrastructure and reducing dependency on imports by boosting local production of specialty chemicals. The project is poised to play a pivotal role in meeting the country’s future industrial demands and supporting economic growth.
