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IOC, French firm Total join hands for bitumen production and marketing
Form equal JV to set up six greenfield plants in the first four years at an investment of Rs 226 cr; Total is leading bitumen player in Europe
State-run Indian Oil Corporation (IOC) and French energy giant Total on Monday formed an equal joint venture to manufacture and market high-quality bitumen derivatives and specialty products for the growing road-building industry in India.
The joint venture company would also set up six new greenfield plants at Panipat, Koyali, Haldia, Barauni, Visakhapatnam and Chennai in the first four years at an investment of about Rs 226 crore. IndianOil is the largest player in the Indian bitumen market, while Total is the leading bitumen manufacturer and supplier in Europe. The two companies already have established a business relationship in India, notably in LPG and fuel additives. The new JV will combine the research and development and marketing strengths of both IndianOil and Total to manufacture and market innovative bitumen formulations and superior quality products such as polymer-modified bitumen, crumb rubber-modified bitumen, bitumen emulsions and other specialty products.
“The JVC will combine IndianOil’s credentials as India’s flagship national oil company and Total’s strength as an international energy major. It would cater to B2B customers involved in road infrastructure development both in the government and private sectors, and I am confident that this would bring a revolution in road construction in the country by providing superior technology products at competitive prices," said SM Vaidya, chairman of IOC. The JV will set up manufacturing units across the country with cost-effective logistics solutions, keeping innovation, safety and sustainability at the helm of its operations. It will also explore the possibility of catering to other South Asian markets
“The JVC would bring in latest technologies and formulations for polymer-modified bitumen and other fast-growing non-conventional derivatives such as cold mix and micro-emulsion and block bitumen to the Indian market," he added. The operations of the JVC would commence by taking over an existing plant of Total at Jodhpur.
“India is a strategic country for the future of Total and we are delighted by this partnership, yet another testimony of our commitment to this fast-growing market,” said Patrick Pouyanné, Chairman and chief executive officer of Total. “Today, Total is further cementing its longstanding business cooperation with IndianOil into a strong and sustainable new partnership. With this agreement, we are pursuing the growth of businesses with key Indian energy players, adding to our ongoing developments in renewables, gas and power.”
Both the companies are targeting the planned road infrastructure with mega projects like the ‘Bharatmala’ project, which envisages development of 34,800 kilo meter of roads at an estimated investment of over Rs. 5 trillion (around $ 66 billion) in the first phase. The demand for aggregate material and manufactured material for the highway construction and rehabilitation sector in India is very high, especially for good-quality bitumen derivatives. The IndianOil and Total JV will offer high-spec products using sustainable technologies.
Interestingly, this can also be seen as an initiative by Total to spread wings in India after the acquisition of 37.4 per cent stake in Gautam Adani-led Adani Gas in a bulk deal worth Rs 5,152 crore in February this year.
Source : Business Standard
