Bhubaneswar: SIBUR, Russia and Eastern Europe's largest petrochemical company, and Reliance Industries Limited (RIL), India's largest private company, have agreed to form a joint venture named Reliance Sibur Elastomers Private Limited to produce 100,000 tons of butyl rubber per year in Jamnagar, India.

The JV will be the first manufacturer of butyl rubber in India and the fourth largest supplier of butyl rubber in the world. The JV will cater to the demand for synthetic rubber from the Indian automotive industry of over 75,000 tonnes per year, which is currently satisfied by imports. Investment in the JV is in line with Reliance’s vision of emerging as a significant player in the global synthetic rubber market.

Reliance share in the JV will total 74.9%, while Sibur will account 25.1%. The JV will invest US$450 million to construct the facility, which is expected to be commissioned in mid-2014. Reliance and SIBUR also signed a technology licence agreement facilitating use by the JV of SIBUR's proprietary butyl rubber production technology at the new production facility. SIBUR will develop basic engineering design for the facility and also train the JV’s personnel at SIBUR’s production site in Togliatti, Russia.