Bharat Petroleum Corporation Limited (BPCL) is set to invest approximately $11 billion to develop a new refinery and petrochemical complex in the southern Indian state of Andhra Pradesh. This massive project is aimed at tackling India’s surging demand for fuel and petrochemical products, positioning BPCL to meet both domestic energy needs and growing industrial demand, particularly in the automobile and petrochemical sectors.
Refinery Expansion and Petrochemical Production
The new facility will feature a refinery with a capacity of 9 million metric tonnes per year (mtpy) and an ethylene cracker. The refinery is expected to cost between INR900 billion and INR950 billion ($10.5 billion to $11.1 billion) and will have a petrochemical intensity of 35%. This project is particularly significant as southern India, which is home to several key industrial sectors, will see 80% of the output from the facility marketed locally.
This expansion aligns with BPCL’s strategy to enhance its refining capacity to keep up with the expected rise in India’s energy demand. BPCL’s Chairman G Krishnakumar highlighted that India’s energy needs are projected to grow exponentially, and this new refinery will help meet the demands of a rapidly developing economy.
Addressing Energy Security and Reducing Dependence
BPCL’s investment also aims to reduce the company’s dependence on imported fuels, which currently accounts for 20% of its sales. By expanding its refining capabilities, BPCL intends to cut down on the need to purchase refined fuels from external sources, bolstering its energy security. This initiative will help BPCL better serve India’s increasing energy demands, as the country’s per capita consumption of petrochemicals is expected to rise due to growing manufacturing activities.
Clean Energy and Future Projects
Alongside its refining expansion, BPCL is increasing its efforts to diversify into clean energy. The company is planning to bid for government renewable energy projects and acquire companies to help it reach its ambitious goal of 10 GW of renewable energy capacity by 2035. BPCL has already partnered with Sembcorp to grow its renewable energy portfolio, which currently stands at 300 MW.
BPCL is also actively participating in the Mozambique liquefied natural gas (LNG) project, with a 30% stake alongside other Indian firms. The $20 billion LNG project is expected to begin operations by 2025 and aims to monetize natural gas by 2028-29.
Future Expansion Plans
BPCL’s expansion plans also include a potential joint venture with Oil and Natural Gas Corporation (ONGC) to establish a new refinery in Uttar Pradesh. Additionally, BPCL is focusing on expanding its existing refineries, including the Bina refinery in Madhya Pradesh, with a projected INR490 billion investment.
Leave a Reply
You must be logged in to post a comment.