As part of its transition strategy, India's largest oil company, IOC, will invest Rs 61,077 crore in the construction of a petrochemical complex in Paradip, Odisha, the company's largest ever investment in a single location. Indian Oil Corporation (IOC) said in a statement that its board of directors has given "Stage-1 approval for the establishment of the Paradip petrochemical complex in Paradip, Odisha at an estimated cost of Rs 61,077 crore."

"This mega project will be the largest-ever investment of Indian Oil at a single location," it said but did not give timelines for completion of the project.

This is part of its transition strategy, which also includes increasing petrochemical intensity to help protect against volatility. The percentage of crude oil that is converted directly into chemicals used to make plastic and other materials is referred to as petrochemical intensity.

Crude oil extracted from the ground and beneath the seabed is refined into gasoline, diesel, and other fuels in refineries. It can be processed to produce petrochemicals instead of fuels.

IOC's petrochemical intensity (the percentage of crude oil converted into chemicals) is currently low at 5-6 percent. The company intends to increase it to 10-12%.

The company's newer refineries in Panipat, Haryana, and Paradip, Odisha, have a petrochemical intensity of 15-20%, which will be increased to 25%, according to its chairman, Shrikant Madhav Vaidya, in an interview last month.

The term "energy transition" refers to the transition away from fossil-based energy production and consumption systems, such as oil, natural gas, and coal, and towards renewable energy sources such as wind and solar, as well as lithium-ion batteries. This shift is expected to gradually reduce demand for gasoline and diesel, so IOC is undertaking petrochemical projects in preparation.

The company stated that the Paradip petrochemical complex would include a world-scale cracker unit as well as downstream process units for producing a variety of petrochemical products such as polypropylene (PP), high density polyethylene (HDPE), linear low-density polyethylene (LLDPE), and poly vinyl chloride (PVC), which are the building blocks of various grades of plastics. It shall also facilitate production of niche chemicals and petrochemicals like phenol and isopropyl alcohol.

Vaidya commented on the development, saying, "This megaproject is in line with Prime Minister Narendra Modi's Purvodaya vision, which is certain to accelerate development and fuel prosperity in Eastern India. This cutting-edge, state-of-the-art petrochemical complex will undoubtedly have a transformative impact, propelling the Aatmanirbhar Bharat initiative forward significantly."

"This mega project shall significantly improve the petrochemical intensity index of IndianOil. It shall be a growth driver in making the company a major player in the petrochemical industry, while strengthening India's self-reliance in the petrochemical sector," he said.

The project, the statement said, will catalyze the growth of PCPIR and Plastic Park at Paradip.

"On commissioning of this project, domestically available Petrochemicals are expected to provide feed and vitalise industrial growth in key downstream industries like plastic, pharma, agrochemical, personal care, paints etc. It is also expected to create employment opportunities in eastern India, especially Odisha," it added.