RIL to set up world-scale polyester projects in Gujarat

Reliance Industries today said it has begun implementation of a world-scale polyester projects in Gujarat.

Reliance plans to set up "2.3 million tonne of purified terephthalic acid (PTA) plant at Dahej (in Gujarat) with the ability to increase it by another 1.15 million tonne of PTA at a later stage," the company said in a press statement here.

The plants will be integrated with its Paraxyline plants at Jamnagar for raw material.

With Indian polyester demand growing at over 10%, Reliance has renewed its focus on expansions along the chain. Projects that were put on hold after the 2008 economic crisis have been revived and deadlines set.

The company's plans include two a 395,000 tonne of polyester filament yard (PFY) and 140,000 tonne of polyester texturised yarn at Silvassa in Gujarat.

Also, it will set up a 540,000 tonne polyethylene terephthalate (PET) at Dahej with the option to an equal size plant at the same location at a later sate.

Reliance did not give investments involved in the projects nor the deadline for completion.

"All the projects are under various stages of implementation ranging from technology licensing, basic engineering and obtaining the necessary regulatory approvals," the company statement said. "This capacity addition will further strengthen Reliance's leadership position in the polyester sector."

Reliance may start the first PTA plant at Dahej in first quarter of 2013 and the second one 6-12 months later.

Part of the feedstock requirement for the PTA plants would be covered by Reliance's 1.7 million tonne a year paraxylene plant at Jamnagar. The rest would come from a new 1.3-1.5 million tonne PX train, also at Jamnagar, which was scheduled to start operations in 2013.

The new PTA volumes would feed the company's downstream polyester investments at Silvassa.

Silvassa is a texturising hub and Reliance already has a unit there which will be integrated with the new units.

"This is Reliance's largest capacity expansion in the sector and is aimed at consolidating its position as the world's largest integrated polyester producer," the statement said. "These investments in new polyester capacity will also strengthen India's position as a global manufacturing hub for textiles and fibre."

The global supply constraints, substantial price increase and uncertain outlook for cotton availability is creating considerable substitution opportunities for polyester products like Polyester Filament Yarn (PFY) and Polyester Staple Fibre (PSF).