Bharat Petroleum to invest Rs1,00,000 cr for expansion in 5 years
11 September 2015
Bharat Petroleum Corporation (BPCL), India's second-largest state-run refiner and fuel marketer, has targeted a Rs1,0,000 crore expansion plan, involving addition of 20 million tonnes of refining capacity between FY17 and FY21.
The proposal is to increase the PSU's refining capacity from about 30 million tonnes per annum (mtpa) at present to 50 mtpa, in addition to expanding fuel marketing network in India and abroad.
''We want to have a truly global presence in refining and marketing and exploration and production in the next five years. We have embarked on a new five-year plan called project Sankalp under which the company will be doubling its investments from Rs50,000 crore in last five years to Rs100,000 crore in the next five years,'' S Varadarajan, chairman and managing director of BPCL said on Tuesday.
BPCL, meanwhile, reported the highest ever net profit of Rs5084.51 crore, crossing the Rs5,000-ct profit mark for the first time, while gross revenues of the company increased by 25 per cent year-on-year to Rs2,53,254.86 crore last financial year.
Varadarajan said the Rs1,00,000-cr investment proposals involve a strategy of going beyond fuel, and foraying into petrochemicals and entering new markets for expansion of retail sales.
BPCL plans to spend Rs25,000 crore on upstream investments in the Mozambique and Brazil projects, while expansion of refining capacity will involve Rs35,000 crore.
For first time, the company will invest Rs4,600 crore in a petrochemical project. BPCL is setting up a project at Kochi to produce SAP (super absorbent polymer) and expects revenues from this project to start flowing in by 2019-20. The regulatory clerances for the project are in place and work at the site has commenced.
The BPCL CMD said he is confident that going forward, the company would see better performance both in terms of volumes and refining margins. ''If the country sees a petroleum product demand of about 4 per cent, it means there is an incremental demand for 7-8 million tonnes of products in a year,'' added Varadarajan.
Strengthening of marketing infrastructure will cost around Rs12,000 crore. The company will also be entering downstream operations in Nepal, Bangladesh, Ghana, Tanzania, Varadarajan said.
The government, meanwhile, is looking to sell some stake in Bharat Petroleum and a final decision will be taken after ministerial consultations.
BPCL is also set to bag the coveted 'Maharatna' status by the end of this fiscal, thereby joining the select league of seven central public sector enterprises (CPSEs) as falling crude oil prices and reduced losses add to the PSU oil firm's profitability.
With Maharatna tag, BPCL hopes to race ahead of its peer HPCL in the race as the status will help BPCL to take investment decisions of up to Rs5,000 crore.