For some reason, BP and Indian Oil Corporation (IOCL) have decided to abandon an acetic acid plant in Gujarat.

The companies intended to develop a one million tpa plant at Koyali in Vadodara district of the state. The decision of scrapping the project has been taken as the feasibility studies suggest that the plant is economically unviable. According to the companies, there are certain issues on the capital cost. It appears that the project does not meet the requisite norms.

In 2011, both the companies had inked an MoU to set up a plant and build infrastructure for gasification facilities to produce synthethic gas.

However, a joint feasibility study is underway to confirm the exact configuration of the project that would have a targeted start-up date in 2015.

The feasibility study for the new acetic acid plant was carried out in the vicinity of the existing Koyali refinery operated by IOC. The proposed plant was to employ BP’s Cativa XL technology, while gasification facilities would utilise petroleum coke feedstock from IOC.