GAIL plans to buy petrochem plants in Qatar, Russia

New Delhi, Oct 29 | Updated: Oct 30 2007, 05:41am hrs
State gas utility GAIL India is eyeing petrochemical plants in Russia and Qatar as part of its plans to become $10-billion company by the next century.

GAIL chairman and managing director UD Choubey, who opened a window of opportunity in Russia last week, was in Doha on Monday for talks with the state-owned Qatar Petroleum to build a petrochemical plant in Qatar, official sources said. The Indias largest natural gas distributor wants to build a plant in Qatar with a capacity to produce one million tonne of polymers for exports. Polymers are used to make car parts and machinery.

Sources said Choubey, who is part of the high-level delegation led by Petroleum minister Murli Deora, is also seeking liquefied natural gas (LNG) from Qatar. Last week, he held separate talks with Russian oil firm Lukoil and gas utility Itera in Moscow for a petrochemical plant in the former Soviet republic.

Choubey met the board of Lukoil and discussed possibilities of setting up a petrochemical plant jointly with the Russian firm. He also evinced interest in GAIL picking a stake in Lukoils onland gas-rich Block A in Saudi Empty Quarter, near Ghawar in Saudi Arabia. GAIL and Lukoil may set up a petrochemical plant in Saudi Arabia based on the gas in the field as also export the fuel to India in form of LNG. Lukoil has 80% in the 29,000-sq km area, while the remaining 20% is with Saudi Aramco.

Separately, GAIL is discussing with Russian gas firm Itera for setting up a city gas distribution (CGD) network in Moscow to retail compressed natural gas (CNG) to automobiles and a methane-based petrochemical plant in Russia, sources said.

With Itera, GAIL is likely to sign an MoU for city gas project in Moscow and exploring feasibility of methane-based petrochemical plant when Itera chairman Igor Viktorovich Makarov visits New Delhi later this year. Choubey also explored possibility of petrochemical project in Russia with Sibur Holding, in which Russian gas monopoly Gazprom has majority stake.

Under Choubey, GAIL has identified petrochemical as one of the key areas besides natural gas transmission and distribution, for growth. It has been scouting for opportunities for petrochemical plants in India and overseas and the same quest has taken it to gas-rich Russia.