BPCL will invest Rs1,500 cr in exploration, production projects

BPCL will invest Rs1,500 cr in exploration, production projects
Comment E-mail Print Share
First Published: Mon, Jul 23 2007. 01 01 AM IST
Updated: Mon, Jul 23 2007. 01 01 AM IST
One of India’s leading oil marketing companies, Bharat Petroleum Corp. Ltd (BPCL), has earmarked Rs1,500 crore for hydrocarbon exploration and production projects.
These will be carried out by its subsidiary Bharat Petro Resources Ltd (BPRL) and is part of the Rs10,000 crore capital expenditure that the company has lined up for the next five years through 2012.
“We plan to spend Rs1,600-2,000 crore per annum over a period of five years. We do not plan to raise any debt for this as our internal generation of funds will fully take care of this,” said S.K. Joshi, director, finance, BPCL.
The company is a relatively new entrant in the high-stake exploration and production business, compared to the entrenched players such as ONGC Corp. and Indian Oil Corp. It recently formed Bharat Petro with an authorized capital of Rs1,000 crore.
In a related development, Bharat Petro is in talks with domestic and overseas exploration and production players for a consortium to bid for the blocks to be offered in the seventh round of new exploration licensing policy (Nelp). The company is concentrating its exploration and production efforts in the area of gas exploration.
The companies that Bharat Petro is looking to rope in include public sector companies such as Hindustan Petroleum Corp., Oil India Ltd, Gujarat State Petroleum Corp. and ONGC, says Bharat Petro chief executive B.K. Menon. “We will also be interested to partner with our existing partner Premier Oil with whom we already have a partnership for the Cachar block in Assam.”
Acquiring equity in hydrocarbon blocks has become a key area of focus for oil marketing companies as they seek assured supplies for their refineries, creating a cushion against volatile crude prices.
“We are looking at a mix of on-land and offshore opportunities. We are not an aggressive player in the E&P space,” said Joshi.
The government had originally planned to offer 70 blocks over around 300,000 sq. km in the seventh Nelp round.
More than 30 of these blocks are off the west coast, in water that is 90-100m deep. The government may decide to lease out fewer blocks in the coming auction than initially planned due to shortage of deepwater rigs, needed for offshore exploration, as earlier reported by Mint on 14 July.
BPRL has participating interest in 14 oil and gas exploration blocks in India and overseas—with equity stakes in the hydrocarbon blocks in Oman, East Timor and Australia.
Comment E-mail Print Share
First Published: Mon, Jul 23 2007. 01 01 AM IST