Petronet LNG and Deepak Phenolics Sign a Long-Term Supply Agreement

Petronet LNG Limited has entered into a definitive sale and purchase agreement with Deepak Phenolics Limited to supply propylene and hydrogen for the next 15 years. This agreement, approved by PLL’s Board on 27th January 2025 and signed on 6th February 2025, marks a strategic milestone in the Indian petrochemical industry. The long-term contract ensures reliability in the supply of key chemicals, fostering industrial growth and operational efficiency.

Key Terms of the Agreement

Under the agreement, PLL will supply 250 kilotonnes per annum (KTA) of propylene and 11 KTA of hydrogen from its Petrochemical Complex in Dahej, Gujarat. The contract ensures a steady and high-quality supply of these materials to DPL, supporting its manufacturing processes. Propylene is a crucial component in the production of various polymers and chemicals, while hydrogen plays a growing role in energy and industrial applications.

The agreement provides DPL with a stable procurement source, allowing it to optimise production while reducing supply chain risks. For PLL, this deal reinforces its position in the petrochemical sector, ensuring a consistent demand for its products and diversifying its revenue streams beyond LNG operations. The 15-year duration of the agreement offers long-term benefits, shielding both companies from market volatility.

Strategic Impact on the Industry

This collaboration represents a significant step in the evolving petrochemical landscape of India. For PLL, the agreement strengthens its downstream expansion strategy, highlighting its capability to integrate petrochemical production into its core business model. The company’s Dahej complex is poised to play a vital role in meeting the country’s growing demand for propylene and hydrogen, reinforcing its contribution to industrial development.

For DPL, securing a reliable supply of essential raw materials enhances its production stability, ensuring that its phenol and acetone manufacturing operations run smoothly.

Petronet LNG Share Performance 

As of February 07, 2025, at 9:30 AM, the shares of Petronet LNG are trading at ₹311.35 per share, reflecting a surge of 0.27% from its previous day’s closing price. The stock has experienced a decline of 5.78% over the past month.

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