By IZZAT RATNA / Pic by TMR
Petroliam Nasional Bhd (Petronas) is allocating some RM735 million in capital expenditure (capex) to increase its market presence in India through its subsidiary, Petronas Lubricants International Sdn Bhd, over the next five years.
The investment includes the building of a RM245 million lubricant blending plant with a 110 million-litre capacity in Patalganga, India, that is slated for completion in the first-quarter of 2018.
The state-owned Malaysian oil and gas firm’s CEO Datuk Wan Zulkiflee Wan Ariffin said that this investment is in line with the Indian government’s “Make in India” transformation initiative.
“We are aiming to triple our market share in India’s lubricant market by 2022. Globally, we are among the top 10 lubricant players by market share, and striving to eventually be among the top five in five years.
“I look forward to see more collaborations fostered between Petronas and our counterparts in India, to pave the way for a stronger cooperation for the mutual benefits,” he said in a statement yesterday.
The expansion was sparked by the growth and performance of Petronas’ liquefied petroleum gas (LPG) joint venture with Indian Oil Corp Ltd, which currently owns LPG bottling terminals in Haldia, West Bengal, and in Ennore, Tamil Nadu.
With more than two decades of strategic partnerships in India, Wan Zulkiflee said Petronas is enhancing its business strategy to strengthen and expand its presence in the world’s fastest-growing economy.
He added that Petronas’ annual visit to meet India’s industry leaders and partners was expected to expand the firm’s LNG supply in the country to help meet the rising demands from the power, agriculture and transportation sectors.
During the visit, Petronas also undertook a three-year agreement between its wholly owned subsidiary Petronas Chemicals Group Bhd and Reliance Industries Ltd for the supply of up to 120,000 metric tonnes of paraxylene.
To date, the company has delivered 15 LNG cargoes to India. Recently, it delivered the first cargo produced from its floating LNG production facility to the country.
Petronas’ strategic partnerships in India have also resulted in successful advances in the marketing and trading of crude oil, and other petroleum products and petrochemicals, as well as the distribution of lubricants.
The company also sees growth in demand for petrochemicals in India, especially with the growing affluence that will see the increased demand for consumer products.
In 2016, India made up over 100,000 tonnes of Petronas’ petrochemicals sales volume.
With over 30 million tonnes per annum supply capacity, Petronas is currently the third- largest LNG player globally.
The company hopes to further contribute to the energy needs of India, which is the fourth-largest LNG market in the world.
Leveraging on its long history and sterling reputation in the global LNG business, Petronas has the added advantage to provide tailor-made solutions across the LNG value chain such as flexibility, engineering expertise and experience in operations management.
India’s robust growth trajectory and thriving demand for consumer products as well as clean energy to fuel it growth plans have put Petronas in a position to support the republic’s future aspirations.
On the domestic front, Petronas’ share price closed at RM18.78 yesterday with a market capitalisation of RM37 billion.