RIYADH, 13 June — Indian petrochemical giant Southern Petrochemicals Industries Corporation (SPIC) has finalized plans to invest $300 million in two major projects in the Kingdom. The General Investment Authority has granted licenses for the projects to produce normal paraffin and linear alkyl benzene.
Addressing a news conference at the Indian Embassy here yesterday, Dr. A.C. Muthiah, SPIC chairman, said the SPIC-promoted Tamil Nadu Petroproducts (TPL) was investing in the projects. Indian Ambassador Talmiz Ahmad, Consul General Syed Akbaruddin and TPL Managing Director D. Arunachalam were present at the press briefing.
Ambassador Ahmad said Saudi Arabia and India initialed an investment protection treaty in New Delhi on Monday, which he said would further boost economic relations between the two countries.
Ahmad said Saudi businessmen, of late, have expressed keen interest in setting up joint ventures with Indian partners. The progressively growing commercial relations between the two countries have led to the signing of six joint venture agreements during the visit of an Indian commercial delegation to the Kingdom recently, he added.
Asked about details of the N-paraffin and LAB projects, Dr. Muthiah said TPL was undertaking the projects through the newly-formed Gulf Petroproducts Company in which it holds a 50 percent share. Saudi Offset Limited Partnership (SOLP) and other investors are partners in the venture. Gulf Petroproducts will hold a 60 percent stake in a new company tentatively named as Saudi-Indo Petrochemicals Company.
These projects, he said, would have a capacity to produce 100,000 tons of N-paraffin and 80,000 tons of LAB per annum. “N-paraffin and LAB are intermediate chemicals used in the manufacture of biodegradable detergents,” said Muthiah, who is also a member of the Indian prime minister’s advisory council on trade and industry.
Muthiah said when completed, the projects would meet demand for the chemicals in the six Gulf states, which need a total of 50,000 tons annually. The projects will begin by the end of this year and will be commissioned by early 2004, he said. “These projects bring together Indian operating and technological expertise as well as local and international finance,” he added.
Ambassador Ahmad said it was for the first time that Saudi Arabia had attracted such a huge capital and technology investment from India.
Muthiah said he was holding talks with a number of Saudi businessmen and financial institutions including the Saudi Industrial Development Fund to raise 40 percent of the project capital.
TPL, one of the largest producers of N-paraffin and LAB in India, is a publicly traded company with more than 180,000 shareholders. The TPL plant in the south Indian city of Madras is one of the most modern plants in the world.
