Petrochemical Feedstocks and Refineries

How refineries supply feedstocks like naphtha and propylene for petrochemicals, why integrating refining with chemicals raises value, and India's plans for petrochemical capacity.

Many chemicals start from oil and gas.

Feedstocks

Naphtha, ethane and propane are cracked into ethylene and propylene.
These become plastics, fibres and many chemicals.

Refinery integration

Integrating refineries with petrochemical plants captures more value.
Reliance’s Jamnagar complex combines refining and petrochemicals at huge scale.

India’s demand

India’s per person consumption of plastics and polymers is low compared with China or the US, so demand is expected to grow.
India imports many petrochemicals.

Expansion plans

State firms like IOCL, BPCL and HPCL are adding petrochemical units to refineries.

Energy transition

As fuel demand may eventually peak, refiners see petrochemicals as a future source of demand for oil.

Trade-off

Petrochemicals raise concerns about plastic waste and emissions.

The cracker unit

At a refinery, a cracker unit turns naphtha into ethylene, which a neighbouring plant turns into plastic granules for packaging.

Thinking oil is only used for fuel

It's also a feedstock for plastics and chemicals.

Key takeaways

Petrochemicals come from oil and gas feedstocks.
Integrating refining and chemicals adds value.
India's plastics demand is expected to grow.
Refiners see petrochemicals as future demand.