Bharat Petroleum may set up petrochemicals unit in Bina
- Indians killed in Iraq: Sushma Swaraj accuses Congress of indulging in ‘cheap politics’
- Sterlite Power acquires Rs1,500 crore Goa-Tamnar project
- Another Periyar statue vandalized in Tamil Nadu
- Mahindra Bolero makes it to top 10 passenger vehicle list in February
- Airbus is said to weigh new A330 cargo model, spurred by Amazon, UPS
Mumbai: State-run Bharat Petroleum Corp. Ltd (BPCL) plans to set up a petrochemicals unit at its Bina refinery in Madhya Pradesh as part of its Rs25,000-crore expansion plan for the refinery, two company officials aware of the development said.
The petrochemical unit, which will include a 1.5 million tonnes per annum (mtpa) naphtha cracker, is expected to cost Rs6,000-7,000 crore, the officials said.
“The investments could be made through a special purpose vehicle or issue of warrants. We are continuously evaluating the model to be followed here,” said one of the two officials cited above on condition of anonymity.
Bharat Oman Refineries Ltd, a joint venture of BPCL and Oman Oil Co., runs the Bina refinery. While BPCL holds 49% in the venture, Oman Oil owns 26%. Financial institutions own the remaining 25%. BPCL did not respond to an emailed questionnaire sent on 25 January seeking comments.
Last April, BPCL decided to fund the Rs3,000-crore expansion of Bina refinery through the sale of convertible warrants by Bharat Oman Refineries to shareholders. Oman Oil was unwilling to participate in the expansion of Bharat Oman Refineries, BPCL said last year.
Bharat Oman Refineries registered a net profit at Rs366 crore for the first time in 2015-16. That compares with a loss of Rs790 crore in the previous fiscal year.
BPCL is raising the Bina refinery’s capacity in two phases—to 7.8 mt a year from current 6 mt at a cost of Rs3,072 crore by 2018 and then to 15 mt for an additional investment of Rs25,000 crore in the next four-five years.
BPCL plans to spend Rs1 trillion over the next five years to expand capacity, half of which is likely to go into increasing its refining capacity.
By 2022, BPCL plans to raise its crude processing capacity by 62% to 1.18 million barrels per day (bpd) from the current 730,000 bpd.
“Petrochemicals in India has not realized its full potential yet. Looking at the development and growth the Indian economy presents, petrochemicals is a huge opportunity and BPCL wants to be a part of that,” said the second official. He also declined to be identified.
The firm is also expanding refining capacity at its Kochi refinery from to 15.5 mtpa from 9.5 mtpa for an investment of Rs16,000 crore. It will also build a Rs5,000 crore petrochemical plant in Kochi. When completed, it will facilitate production of 500,000 tonnes per annum of propylene, which is in addition to fuels like cooking gas, diesel, kerosene, jet fuel, coke and bitumen. The expansion would be complete by March. Last April, the government approved BPCL’s investment of Rs3,000 crore in Bharat Oman Refineries for the first phase of expansion.