Reliance Industries to launch gasification assets’ restructuring and repurposing
Reliance Industries Limited said that its board has today decided to execute a scheme of arrangement for transferring Gasification Undertaking into a fully-owned subsidiary.
The scheduled date of the scheme will be 31 March 2022 or any other date set by the company’s board. The scheme will be subject to approval from stock exchanges, shareholders, creditors, NCLT, and other regulatory authorities.
According to Reliance Industries, the Gasification project located at Jamnagar was established with the aim of producing syngas to address the energy needs as refinery off-gases, that were previously used as fuel, were converted to feedstock for the refinery off gas cracker (ROGC). This allows the production of olefins with competitive operating and capital costs, said the Indian conglomerate.
Reliance Industries stated that syngas as a fuel assures the security of supply and decreases the volatility in the costs of energy. Syngas can also be used to make hydrogen for consumption in the group’s Jamnagar oil refinery.
The conglomerate said that it intends to create a portfolio that is 100% recyclable, sustainable as well as carbon neutral. This can be accomplished by moving to high value materials and chemicals that use renewable energy as the main source of the energy requirements, said the group.
Reliance Industries said that as it gradually shifts towards renewable energy as its main energy source, more volumes of syngas will be available for upgrading to higher value chemicals like C1 chemical compounds and hydrogen.
Additionally, the carbon dioxide released in the process of making hydrogen is very concentrated and is easy to capture, therefore resulting in the reduction of the expenses for carbon capture. In all, the measures will significantly reduce the carbon footprint of the Jamnagar refinery complex, said the Indian conglomerate.
As per Reliance Industries, India is a high growth market and will be in the midst of a shortage of these valuable chemicals in the near future. Reusing the gasification assets can aid in the use of syngas as a dependable source of feedstock to manufacture these chemicals, and meet the increasing demand from the domestic market, which will lead to a lucrative business opportunity.
Furthermore, as the hydrogen economy grows, the Mukesh Ambani-led group will be well poised to take the first step in establishing an ecosystem for hydrogen.
Due to the optionality in applications for Syngas, the type of risks and returns related to the gasifier assets will be expected to be different from other businesses within the group.
Reliance Industries said that the distinct business profile also offers the potential to draw a different group of strategic partners and investors for the gasification assets and the development of new chemicals and materials.