Essar Chemicals Ltd., part of India's Essar Group and ARKEMA, a leading French chemical company, have announced the signing of a Memorandum of Understanding to study the feasibility of a 50/50 joint venture in India for the production and commercialization of Acrylic acid and esters.

For ARKEMA, this will be in line with its strategy to further develop its acrylics business especially in fast growing regions. For Essar, the venture would signify adding value to streams coming out of its world class oil refinery recently commissioned in India.

The new world-scale production plant would come on stream in 2010. It will be located at Vadinar in Gujarat state on India's Northwest coast, downstream from the recently commissioned Essar refinery and use propylene as feedstock.

"This unit will be the first acrylic acid plant to be built in India and would serve the fast growing acrylics market in this part of the world. Its location would be ideal to supply both the Indian and the Asian markets", comments Henri Dugert, Group President of Arkema's Acrylics Business Unit.

Anshuman Ruia, Director, Essar Group, said " The Essar Group is firmly on the path of expanding the value chain in all its businesses and entry into this business would further enhance the potential of Essar Oil's refinery from where propylene, the main feedstock will be supplied to the acrylic complex. Joining hands with Arkema, one of the premier companies in the world in this business, will provide strategic leverage in the Indian chemical market to both companies."

About Arkema
.A world-class chemical concern, Arkema combines three strategically related, integrated businesses: Vinyl Products, Industrial Chemicals and Performance Products. With operations in more than 40 countries and 18,400 employees, the company reported revenue of €5.7 billion in 2005. Leveraging six research centers in France, the United States and Japan and internationally recognized brands, Arkema holds leadership positions in each of its principal markets. With two existing production sites in Carling (France) and Bayport (USA), Arkema intends with this new project to reinforce its position as a global player in acrylic monomers whose main applications are paints and coatings, super absorbents, water treatment, and the paper and textile industries.

About Essar
Essar Global is an international conglomerate operating in six business areas - steel, oil & gas, power, telecom & BPO, shipping and construction with an asset base in excess of US $ 6 billion. It has over 50 representative offices world-wide and employs approximately 15,000 people.

Essar Chemicals Limited is a part of Essar Global Limited and will be the vehicle to enter the value added chemicals business. The Company is currently evaluating various options available based on feedstock streams from Essar Oil Limited's refinery at Vadinar, near Jamnagar in Gujarat.

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