RIL In A Joint Venture With SIBUR, To Produce Butyl Rubber In India

Reliance Industries Limited inks a joint venture with Russian based leading rubber company, SIBUR, named Reliance SIBUR Elastomers Private Limited, with the objective of producing butyl rubber in India. They intend to be the fourth largest supplier of Butyl rubber. The joint venture will have RIL owning 74.9% and SIBUR owing the rest.

SIBUR is currently the largest petrochemical manufacturer in Eastern Europe. Nikhil R. Meswani, Reliance Industries Executive Director, deemed this partnership to be a huge step towards creating a strong domestic manufacturing base for butyl rubber. They intend to produce 1, 00,000 tonnes of rubber in a year in the industrial complex in Jamnagar, Gujarat. The project will be brought to fruition by mid 2014.

This joint venture will mark the first manufacturing of butyl rubber in India. The objective of the demand will be to meet the rising demands of the Indian automotive industry with the current demand accounting to be more than 75,000 tonnes per year. At present, imports have been the only means to resort. Meswani also stated that they would emphasize on producing butyl rubber at a cheaper rate than $4,000-5,000 per tonne cost of imported butyl rubber by using refinery feedstock and manufacturing locally. Around US$450 million will be invested in the construction of the production facility. SIBUR will cater to the basic engineering design for the project and entail to the training of the personnel at the production place, Togliatti, Russia.

The joint venture also paved way for a technology licensing agreement that will enable the production adhering to the SIBUR’s proprietary butyl rubber production technology , comprehending the fact that it has the most eco- friendly project for the same. This avant-garde technology has kept them ahead in the segment of butyl rubber. When asked about the same, Meswani mentioned that they will soon introduce the new polybutadiene rubber facility at Hazira that will enable the production of neodymium catalyst-based polybutadiene rubber. This will hence enable RIL to produce polybutadiene rubber from three varied catalyst systems including cobalt, nickel, and neodymium, depending upon the needs of customers.

RIL known as a trustworthy supplier of polybutadiene rubber of high quality is already a key player in the Indian tyre industry. This joint venture between oil and energy giants of India and Russia will potentially put an end to India’s dependence on foreign rubber imports.