GAIL, US-based Petron form JV to set up bio-ethylene plant

State-run gas utility GAIL (India) Ltd and US-based biofuel manufacturer Petron Scientech Inc have signed a deal to set up a 500 kilo tons per annum bio-ethylene plant.

The bio-ethylene plant, along with its downstream unit(s), based on bioethanol produced at the plant will be a 50:50 joint venture, according to the memorandum of understanding (MoU).

Shares of GAIL were down 1% on BSE to ₹231.45 at 12.30pm on Friday, while the broader Sensex index was little changed.

Public sector entity GAIL is India’s leading natural gas transmission and distribution firm with gas transmission and distribution pipelines, processing and petrochemicals plants besides interest in upstream oil and gas blocks and liquefied natural gas regasification terminals in India.

GAIL executive director for business development, exploration and production Sumit Kishore, and Petron chief executive Yogi Sarin signed the non-binding MoU in the presence of GAIL director for business development Rajeev Kumar Singhal.

GAIL and Petron will jointly undertake feasibility studies to ascertain technical viability and financial prospects of the project, the gas utility said.

“Both the parties endeavor to secure investment approval from their respective management for investment in the project an forming a JV company,” it added.

“We are elated to enter into this strategic relationship with Petron, a pioneer in bio-ethanol to bio-ethylene technology. The MoU signifies a major step towards enhancing sustainable practices and advancing the bio-economy in India. The skills and strengths of both the companies would create a synergy for achieving the objective of MoU,” GAIL’s Singhal said.

New Jersey-based Petron specializes in setting up biomass and grain processing biorefinery projects to produce ethanol, bio-ethylene, bio-chemicals such as ethylene oxide, mono ethylene glycol, methanol, and other bio-fuel projects worldwide.

Petron, along with its affiliates and partners, brings technology experience in production and supply of setting up biorefinery projects, commanding 90% global bio-ethylene technology market.