Reliance-SIBUR JV for halogenated butyl rubber

The unit will produce 60,000 MT of halogenated butyl rubber every year under Reliance SIBUR Elastomers Private Limited – a joint venture of which RIL owns 74.9% and SIBUR 25.1%.

Nikhil Meswani, executive director, Reliance Industries. (Image courtesy: Sam Panthaky/AFP/Getty Images)
Nikhil Meswani, executive director, Reliance Industries. (Image courtesy: Sam Panthaky/AFP/Getty Images)

Reliance Industries (RIL) and SIBUR signed an MoU at the recently-concluded ‘Vibrant Gujarat Summit’ at Gandhinagar to set up South Asia’s first butyl rubber halogenation unit at RIL’s integrated petrochemical site in Jamnagar, Gujarat, India.

The unit will produce 60,000 MT of halogenated butyl rubber every year under Reliance SIBUR Elastomers Private Limited (RSEPL) – a joint venture (JV) of which RIL owns 74.9% and SIBUR 25.1%.

Apart from the planned halogenation unit, the JV owns a 120,000 MT per annum butyl rubber plant, currently under construction at the same venue, which will provide the necessary butyl rubber feed to the halogenation unit.

Commenting on the halogenated butyl rubber unit, Nikhil Meswani, executive director, RIL, said: “RSEPL’s halogenated butyl rubber plant will be well-poised to capitalise on the significant surge in regional demand in tyre and pharmaceutical industries. India is expected to see a quantum jump in tyre production, with Indian and international tyre majors gearing up to make capital investments of INR 150,000 million. The halogenated butyl rubber demand is expected to grow at a rapid pace of 8-10% CAGR over the next few years, driven by increasing customer preference for tubeless tyres in India and neighbouring countries, and significant investments in the manufacture of pharmaceutical closures and tank inner liners.”

“India offers attractive investment opportunities, given the growing local demand for synthetic rubbers and Gujarat’s favourable investment environment coupled with the well-developed infrastructure and raw material availability at a world-class industrial site owned by RIL. SIBUR has a long track record of successful cooperation with RIL and Gujarat’s government, which has provided us with a solid basis for expanding our footprint in India,” said Dmitry Konov, chairman, SIBUR’s management board.

Halogenated butyl rubber is a key ingredient for manufacturing inner liner of tubeless tyre. With the Indian automobile trend aligning with global trends, penetration of tubeless tyres is expected to accelerate in the Indian market, resulting in an increased demand of halogenated butyl rubber. The ingredient is also used in the manufacture of pharma stoppers, inner liner of storage tanks etc.

Construction of the butyl rubber plant is in full swing at Jamnagar, its commissioning targeted for 2018. Production from RSEPL will substitute imports and reduce outflow of valuable foreign exchange from India, providing impetus to the Indian government’s ‘Make in India’ initiative.

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