By DEBJIT CHAKRABORTY
Bharat Petroleum, Indias second-biggest state refiner,
plans to almost double the combined capacity of two
refineries at a cost of about $2.8 billion to feed the
companys growing network of gas stations.
Capacity would rise to 9 million metric tons from 3 million,
costing about $2.4 billion, at Numaligarh refinery in Assam
state and to 8 million tons from 6 million at the Bina site
in Madhya Pradesh province, chairman S. Varadarajan said.
The Numaligarh refinery expansion
is still in the
drawing-board stage and it would hinge on tax concessions and
other benefits from the provincial and federal
governments, Varadarajan said in an interview.
BPCL, as the company is known, joins peers India
n Oil and Hindustan Petroleum
in adding refining
capacity to meet local
n use of petroleum products
may increase by more than 21% to about 186 million tons by
March 2017 from the fiscal year 2012-13, according to the oil
ministrys Petroleum Planning and Analysis Cell.
A 1,338-kilometer (830 mile), 6-million-ton-a-year pipeline
will be built from Dhamra Port in Odisha state to Numaligarh
to feed expanded refining
capacity with imported
crude. Bharat Petroleum owns 61.7% of Numaligarh Refinery
. Bina, costing $2.4
billion, began output in June 2010 and is run by BPCL and
Oman Oil Co.s venture Bharat Oman Refineries.
We will complete the Bina expansion
before December 2016
through debottlenecking, tweaking some existing configuration
and technological improvements, Varadarajan said.
BPCL is also spending $2.3 billion to raise capacity at its
in the south by 6 million
tons to 15.5 million, according to figures in the
companys annual report.
capacity will help expand
its retail fuel business, particularly in north and eastern
, and push sales into
neighboring countries like Nepal and Bhutan. BPCL sold about
18% more fuel than it processed in the year ended March 31,
buying from rivals or overseas to fill the gap.
It added 1,257 outlets in the period and plans to add about
1,000 annually for the next few years, on top of the 11,637
it owned as of March 2013, giving a market share of 27.5%.
The government in June 2010 freed pump prices, and allowed
state refiners in January 2013 to raise diesel prices by
about 0.50 rupees a liter each month in a move toward
These changes could lead to greater competition from
private players in the days ahead, Varadarajan said.