Mumbai: Indian Oil Corporation (IOCL), India’s largest refiner and marketer of petroleum products, and French energy major Total, have entered into an equal joint venture to manufacture and market bitumen derivatives and specialty products for the growing road-building industry in India.
The joint venture will set up manufacturing units across the country to manufacture and market bitumen formulations and products such as polymer-modified bitumen, crumb rubber-modified bitumen, bitumen emulsions and other specialty products.
The JV will also explore the possibility of catering to other South Asian markets, IOCL said in a statement.
“The joint venture would cater to B2B (business to business) customers involved in road infrastructure development both in the government and private sectors," said SM Vaidya, Chairman, Indian Oil.
The operations of the joint venture would commence by taking over an existing plant of Total at Jodhpur. In addition, six new greenfield plants would be set up at Panipat, Koyali, Haldia, Barauni, Visakhapatnam and Chennai in the first four years. The investment planned towards these new plants is about Rs. 226 crores.
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.
And with projects like the Bharatmala, the Government of India has a strong focus on developing the country’s road infrastructure. Bharatmala envisages development of 34,800 km of roads at an estimated investment of over Rs. 5 lakh crore in the first phase.
"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," said Patrick Pouyanné, Chairman and CEO of Total.
IOCL is the largest player in the Indian bitumen market, while Total is a leading bitumen manufacturer and supplier in Europe. The two companies have already established a business relationship in India, notably in LPG and fuel additives.