Andhra petro project achieves financial closure

Hyderabad: Andhra Petrochemicals Ltd has achieved financial closure for its Rs 320-crore optimisation-cum-modernisation of its existing oxo-alcohols facility at Visakhapatnam.

Of the Rs 320 crore, the company availed itself of a Rs 192-crore term loan and the balance would be met out of internal accruals and equity.

The IDBI Bank Ltd, which has appraised the project, has syndicated the rupee term loan with their subscription of Rs 54 crore.

State Bank of India, State Bank of Hyderabad and Andhra Bank each subscribed Rs 46 crore.

According to a company press release, the loan documents were executed on June 11 at the Visakhapatnam plant by Mr Mullapudi Harischandra Prasad, Managing Director of the company, and senior officials of the participating banks.

The project intends to increase the plant capacity from the present 39,000 tpa (tonnes per annum) to 73,000 tpa.

Further, the optimisation-cum-modernisation would use the latest technology, to raise plant efficiencies and produce all the three products — 2-ethyl hexanol, n-butanol and i-butanol — simultaneously.

Oxo-alcohols are used as solvents and find wide applications in the petrochemical industry, in PVC, coatings and adhesives.

In the existing plant these three products can be produced sequentially.

The enhanced capacity is expected to be commissioned during the last quarter of fiscal 2009-10. Post-commencement of operations, the company would increase the market share for these products significantly, Dr V.N. Rao, Chief Executive and Chief Operating Officer of the company, said in the release.