The Hindu Business Line : BPCL to complete Mumbai refinery expansion this fiscal

BHARAT Petroleum Corporation Ltd will complete capacity expansion of its nine-million-tonne (m.t.) Mumbai refinery by adding another three m.t. at a total investment of Rs 1,831 crore this financial year.

This will help BPCL reduce reliance on product supplies from other oil companies especially in northern India where it does not have a refinery. Public sector oil marketing companies buy products from each other in parts of the country where they do not have product supply sources.

The expansion will happen simultaneously with its planned extension of the Mumbai-Manmad-Indore pipeline up to Delhi.

"The modernisation project will not only bring the refinery at par with Euro III environment norms, we have added one more unit to the refinery that will take the refining capacity up to 12 m.t.," Mr Mukesh Rohatgi, Director (Refinery), told Business Line.

With a palpable increase in demand for petroleum products for the first time in years, senior BPCL officials believe the capacity expansion will help the company meet this rising demand.

Consumption of petroleum products was at - 4 per cent in the first six months of the financial year but ended at a positive 1.6 per cent this year. The overall demand is expected to be higher in 2004-05.

In 2003-04, BPCL's Mumbai refinery processed 8.7 m.t. of crude. Its subsidiaries Kochi Refinery and Numaligarh Refinery processed 7.8 m.t. and 2.2 m.t., respectively. With the additional capacity, BPCL will be able to process up to roughly 22 m.t.

The company imported roughly 10 m.t. of its crude requirements during the last fiscal at a cost of $1.8 billion.

The company has also appointed consultants for preparing its risk management policy to begin hedging crude imports.

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