Nayara Energy achieves financial closure for petrochemicals expansion.

Nayara Energy has tied up a project term loan of Rs. 4,016 crore for the first phase of its petrochemical plant expansion plans.

The company said it signed a financial agreement with a consortium of banks led by State Bank of India for the assistance. A statement from Nayara Energy said the funds will be used to set-up a 450,000-tonne-per-annum (KTPA) polypropylene plant at its Vadinar refinery in Gujarat.

The loan facility carries a tenure of over 15 years. The project is proposed to be funded with a mix of debt and equity.

"The company is already in possession of required land and does not need to acquire fresh parcels for the upcoming project," Nayara said.

Alois Virag, Chief Executive Officer, Nayara Energy said, "The financial closure brings to fruition our growth plans to become one of the largest integrated energy and petrochemicals complexes in the country. The demand for polypropylene is expected to grow at around 10 per cent per annum. The construction of the first phase of the petrochemicals project is expected to be completed in 2023."

Nayara Energy had first announced its plans to expand into petrochemicals at the Vibrant Gujarat Summit in 2019.

In August 2017, Nayara Energy (then Essar Oil) was acquired by international investors, Rosneft and an investment consortium comprising of global commodity trading firm, Trafigura and UCP Investment Group. The company owns and operates India’s second largest single site refinery at Vadinar, Gujarat with a current capacity of 20 million tonnes per annum. Nayara Energy’s fuel retail network consists of over 6000 outlets across India.

BS