GAIL announces Rs 60,000 crore ethane capex

State-run Gail India on Monday said it plans to set up a 1500 KTA ethane cracker project at Ashta, district Sehore in Madhya Pradesh, having a product slate of various ethylene derivatives.

The project will entail an investment of Rs 60,000 crore.

ET was the first to report on Gail's plans in its May 21 edition.


Ethane is a component of natural gas. An ethane cracker breaks down ethane into ethylene, which is the key chemical input for making plastics, adhesives, synthetic rubber, and other petrochemicals.

In a regulatory filing, the company said it has submitted its request to the Madhya Pradesh state government to provide suitable enablers for the project

"Around 800 hectares of land will be provided by the MP Industrial Development Corporation Ltd., for which the state government has already initiated the process," Gail said, adding that investment approval from GAIL's board shall be sought after favorable outcome on enablers.

A 70-hectare township is also proposed in the project. The groundbreaking ceremony of the project is expected to take place by February 2025 and commercial production is expected to start in the financial year 2030-31.

Last February, Gail said it wanted to import ethane, as a petrochemical feedstock, from ethane-surplus countries and transport it through Gail's pipeline systems to demand centers.

This March, the company signed a tripartite memorandum of understanding (MoU) with Oil and Natural Gas Corporation (ONGC) and Shell Energy India to explore opportunities for the import of ethane and other hydrocarbons. The MoU would also examine the development of evacuation infrastructure at Shell Energy Terminal, Hazira.

Gail's scrip ended at Rs 208.05, down 2.14% on the BSE, Monday. Benchmark Sensex ended 0.27% higher.