Haldia Petrochemicals Ltd (HPL) has announced a Rs 3,000-crore chemical downstream project, embarking on the most ambitious diversification path undertaken by the company in Bengal in more than a decade.

HPL plans to build India’s largest plant to produce phenol, which finds use in the manufacture of resins, synthetic and nylon fibre, with 300,000-tonne capacity at Haldia. In addition, it will set up a manufacturing unit with 150,000 tonne capacity for acetone which acts as an industrial solvent.

The management has set an ambitious target to complete the projects by the first quarter of 2026. HPL plans to use additional land available with it at the port town Haldia for the venture.

The projects will be financed by a mix of debt and equity. HPL has initiated talks with banks and financial institutions to raise loans. The equity component will be arranged by the company from internal accrual.

The scale of the project and proposed investment suggest that it would be HPL’s biggest brownfield expansion after Project Supermax which expanded the company’s polymer-making capacity by 30 per cent in 2010.

For the chemical downstream units, propylene — a compound that HPL produces — will be the feedstock. “Our aim is to go down the path of value addition. Once complete, the projects would add about Rs 5,000 crore to the topline,” Navnit Narayan, whole-time director and chief executive officer of HPL, said.

The company, now led by The Chatterjee Group (TCG), is hoping that the chemical intermediaries would spawn downstream units in the state, just as it did with polymer. After it was set up as a joint venture by the Bengal government, TCG and Tata Group in 2002, HPL has led to a proliferation of polymer downstream units, large and small, in the state. There are about 1,300 of such units in operation today.

“This will generate direct and indirect employment in the downstream chemical industry. The total industrial scenario evolving around chemicals will witness tremendous growth within a very short period,” Narayan added.

HPL is the largest petrochemical company in the east and one of the largest in India with a total capacity equivalent to 7,00,000 tonne of ethylene. It produces polyethylene and polypropylene, bedrock for plastic based industry.