India’s BPCL to invest Rs1.7 trillion on capacity growth over five years

MUMBAI (ICIS)–India’s state-owned Bharat Petroleum Corp Ltd (BPCL) plans to invest rupee (Rs) 1.7 trillion ($20.3 billion) over the next five years to grow its refining and fuel marketing business, as well as expand its petrochemicals and green energy businesses.

• 44% of total earmarked for refinery, petrochemical capacity growth
• Bina refinery/petrochemical project due for commissioning in FY2028-29
• New refinery project being mulled

As part of the investment initiative named ‘Project Aspire’, some Rs750 billion will go to increasing capacity at BPCL’s refineries and expand its petrochemical portfolio, company chairman G Krishnakumar said in the company’s annual report for the fiscal year ending March 2024.

“The demand for major petrochemical products is expected to rise by 7-8% annually. This presents a strategic opportunity to expand refining capacity alongside the development of integrated petrochemical complexes,” Krishnakumar said.

BPCL’s planned petrochemical expansions include the new petrochemical projects at its Bina refinery in the central Madhya Pradesh state, and the Kochi refinery in the southern Kerala state.

The Bina project is a brownfield expansion that will raise the refinery’s capacity by 41% to 11m tonnes/year, to cater to the requirements of upcoming petrochemical plants, which include a 1.2m tonnes/year ethylene cracker and downstream units.

The site is expected to produce 1.15m tonnes/year of polyethylene (PE), including high density PE (HDPE) and linear low density PE (LLDPE); 550,000 tonnes/year of polypropylene (PP); and 50,000 tonnes/year of butene-1

The complex will also produce chemicals such as benzene, toluene, xylene, the annual report said.

“Technology licensors for all critical packages, and project management consultants for refinery expansion and downstream units have been onboarded and work at the site commenced in the first week of July 2024,” Krishnakumar said.

BPCL has chosen US-based Lummus to provide technologies for the new ethylene plant and downstream units at the complex.

The refinery will be ready for commissioning by May 2028, while petrochemical operations will begin in the financial year ending March 2029.

At Kochi, BPCL’s 400,000 tonne/year PP project is progressing as per schedule and is on track for commissioning in October 2027.

It plans to raise its Kochi refinery capacity by 16% over the next five years to 18m tonnes/year, based on data from the company’s latest annual report.

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The company also plans to set up additional petrochemical capacities over the next few years.

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

BPCL has begun evaluating options to set up a new refinery with a planned capacity of around 9 million to 12 million tonnes/year, a company official said, adding, “we are exploring a new refinery either on the east coast or at other locations”.

In Mumbai, the company also plans to expand its refinery capacity by a third to 16m tonnes/year in the next five years, according to its annual report.

In the eastern Odisha state, BPCL expects to begin operations at its 200 kilolitre/day ethanol plant at Bargarh by October 2024. Once operational, the integrated refinery is expected to produce both first generation (1G) as well as second generation (2G) ethanol using rice grain and paddy straw as feedstock.

Focus article by Priya Jestin

($1 = Rs83.85)

Thumbnail image: The Bharat Petroleum import terminal at Haldia in West Bengal on 13 March 2021. (Debajyoti Chakraborty/NurPhoto/Shutterstock)