BPCL plans refining and petchem complex in 5-7 yrs

New Delhi: Bharat Petroleum Corporation Ltd (BPCL) is exploring setting up an oil refining and petrochemical complex over the next 5-7 years as it steps up capacity to meet India’s rising energy demand, chairman G Krishnakumar told shareholders on Friday.

BPCL, which lost one of its four oil refineries to Oil India Ltd in the aborted privatisation plan, has lined up Rs 1.7 lakh crore of investment for expanding its core oil refining and fuel retailing business as well as in new energy ventures.

“To meet the anticipated demand beyond our planned expansions in Bina and Kochi (refineries), we are actively evaluating options for setting up additional integrated refining and petrochemical capacities within the next 5-7 years,” he said.

BPCL had to give up its Numaligarh refinery in Assam to OIL when the government was attempting to privatise the company. The transfer was to keep the Numaligarh unit within public sector to honour Assam accord. But BPCL privatisation was aborted due to lack of interest by bidders. The firm is now left with refineries at Mumbai, Bina in Madhya Pradesh and Kochi in Kerala.

Krishnakumar said India’s annual consumption of refined fuels and petrochemicals is expected to grow by 4-5 per cent and 7-8 per cent in the ‘foreseeable future’. “This presents a strategic opportunity to expand refining capacity alongside the development of integrated petrochemical complexes.”

Building on its strong Indian energy presence, BPCL aspires to meet 7-10 per cent of the nation’s primary energy demand by 2047, he said adding the firm’s five-year strategic framework aims at nurturing the core and investing in future big bets.

“While we remain committed to growing our core businesses, which include refining, marketing of petroleum products and upstream, we are equally focused on our big bets comprising petrochemicals, gas, green energy, non-fuel retail, and digital,” he said. “... a planned capex outlay of around Rs 1.70 lakh crore over five years will enable us to create long-term value for our stakeholders, while preserving our planet for future generations.”

BPCL’s healthy balance sheet, currently at zero net-debt at standalone level, allows for these investments without compromising financial stability.

Besides expanding oil refining capacity, the firm is looking to become a dominant player in India’s petrochemical growth story. “Towards this, in the financial year 2023-24, we announced two new petrochemical projects in Bina and Kochi with an aggregate capital outlay of Rs 54,000 crore,” he said.