Indian Oil Corporation Ltd. (IOCL), India’s largest refiner and marketer of petroleum products, and Total, a broad energy company with headquarters in Paris, France, are forming a 50-50 joint venture (JV) company that will manufacture and market high-quality bitumen derivatives and specialty products for the growing road-building industry in India.
Total is the leading bitumen manufacturer and supplier in Europe, while Indian Oil is the largest player in the Indian bitumen market. The two companies have already an established business relationship in India, notably in LPG and fuel additives businesses.
The new JV will combine the R&D and marketing strengths of both Indian Oil and Total to manufacture and market innovative bitumen formulations and superior quality products such as polymer-modified bitumen, crumb rubber modified bitumen, bitumen emulsions and other specialty products. The JV will set up manufacturing units across the country with cost-effective logistics solutions, keeping innovation, safety and sustainability at the helm of its operations. The JV will also explore possibilities to cater to other South Asian markets.
“India is a strategic country for the future of Total and we are delighted by this partnership, yet another testimony of our commitment to this fast-growing market,” said Patrick Pouyanné, chairman and CEO of Total. “Today, Total is further cementing its longstanding business cooperation with IndianOil, into a strong and sustainable new partnership. With this agreement, we are pursuing the growth of businesses with key Indian energy players, adding to our ongoing developments in renewables, gas and power.”
“The IndianOil-Total joint venture company would combine IndianOil’s credentials as India’s flagship national oil company and Total’s strength as an international energy major. This would cater to B2B customers involved in road infrastructure development, both in the government and private sectors and I am confident that this would start a revolution in road construction activities in the country by providing superior technology products at competitive prices,” said Shrikant Madhav Vaidya, chairman of IndianOil.
He added: “This joint venture company would bring in latest technologies and formulations for Polymer Modified Bitumen (PMB) and other fast-growing non-conventional derivatives such as Cold Mix & Micro Emulsion, Block Bitumen, etc. to the Indian market. The operations of this JV would commence by taking over an existing plant of Total at Jodhpur and subsequently set up new greenfield plants.”
The Government of India has a strong focus on developing the country’s road infrastructure with mega projects like the ‘Bharatmala project’ which envisages the development of 34,800 km of roads at an estimated investment of more than INR 5 lakh crore in the first phase (equivalent to approximately USD66 billion).
The demand for aggregate material and manufactured material for the highway construction and rehabilitation sector in India is very high, especially for good-quality bitumen derivatives. The IndianOil and Total JV will offer high-spec products using sustainable technologies.