Coconut shells fall into high-tech

A $3 billion Japanese company is seeking to buy up to 20,000 tonnes of coconut shells from India every year to manufacture high-tech carbon molecular sieves, a critical input for nitrogen gas plants based on the pressure swing adsorption technology

By N D Sharma

It is not cutting edge information technology experts or products that Japan is looking to import from India. Instead, it is the ubiquitous coconut shell that has attracted the eyes of the Japanese major, Kuraray Chemical Co Ltd. Earlier, sourcing the coconut shells from its neighbours like the Philippines and Indonesia, Kuraray was forced to look at India as a potential supplier after the 2004 tsunami damaged plantations there.

Coconut shells are a critical component of the next generation carbon molecular sieves, which are used in nitrogen gas plants, manufactured by Kuraray. The company now expects India to be a good source for over two million coconut shells during the current year. The $3-billion Kuraray produces around 38,000 tonnes of carbon molecular sieves in Japan and requires 20,000 tonnes of coconut shells every year. Besides Japan, Kuraray also has factories in Philippines and China for production of carbon molecular sieves.

Says Katsu Takahashi, manager, overseas development, "We have already identified several areas from where we can source coconut shells." Asked if the company was considering setting up a manufacturing unit for carbon molecular sieves is India, he said that is not on immediately the cards. This is because the consumption of carbon sieves in India is not enough to justify such investment. However, Kuraray has entered into a tie-up with Veecon IPA Gastechink Ltd, a leading domestic manufacturer of nitrogen gas plants. Under it, Kuraray supplies the high performance sieves to Veecon, which uses these in the nitrogen gas plants it manufactures.

Says J K Srivastava, managing director of Veecon IPA Gastechink Ltd, "In the long run, we are also exploring the possibility of starting the manufacturing of the sieves in India to bring down the cost of nitrogen plants that are used in middle scale manufacturing plants. A manufacturing unit will involve an investment of $5-6 million." Pressure swing adsorption (PSA)-based nitrogen plants cost between Rs 50 lakh and Rs 5 crore each, and they are used in oil and gas exploration, steel manufacturing and vegetable oil production. "Nitrogen gas manufactured using such sieves will make the end-user plants more compact and increase production by 20-30 per cent," says Srivastava.

In India, the market for industrial gases, including nitrogen, oxygen and hydrogen, is worth around Rs 1,000 crore and is growing at about 20 per cent annually. The market for PSA plants for nitrogen, now estimated at Rs 150-200 crore, is growing at an annual rate of 15-20 per cent.
Srivastava says Veecon-IPA Gastechink, established in 1995, had pioneered the introduction of PSA plants and membrane-based generation of industrial gases like nitrogen, oxygen and carbon dioxide, besides experimenting with the mass production of hydrogen as an alternative fuel. In fact, the Rs 50-crore Veecon-IPA recently tied up with Indian Oil Corporation Limited and the ministry of non-conventional energy sources for the joint development of hydrogen as an alternative fuel.

Besides supplying industrial gases in bulk quantities to varied sectors like pharmaceuticals, chemicals, food processing, oil and gas, aviation, steel and metallurgy, Veecon-IPA has an enviable market share of 35-40 per cent in the total production of gas plants for nitrogen, carbon dioxide and oxygen for industrial clients. The company has set-up 150 PSA units on multiple onsite locations catering to industrial requirements and around 50 membrane-type plants for nitrogen generation.

"We also install cryogenic-type plants for small and medium enterprises which require nitrogen in small quantities. With the advanced sieves from Kuraray, we hope to sell 150 tonnes per year of activated carbon sieves in the next two-three years. This will improve our share in the PSA market for nitrogen alone from the present 15-20 per cent to 35-40 year by that time," says Srivastava.