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BPCL firms up plans for new refineries in UP and MP

The three major joint venture refinery projects being undertaken by the state-owned Bharat Petroleum Corporation Limited -- the Central India Refinery in Madhya Pradesh, the Numaligarh refinery in Assam and the Uttar Pradesh refinery -- with the total capacity amounting to over 16 million metric tonnes per annum will be commissioned during the Ninth and Tenth Plan periods.

BPCL chairman and managing director U Sundararajan said on Tuesday after the annual general meeting that a Rs 52.77 billion, six MMTPA refinery is being set up by the Bharat Oman Refineries Limited, BPCL's joint venture with Oman Oil Company at Bina in Madhya Pradesh.

The project envisages crude oil import facilities consisting of a single point mooring and a crude oil terminal at Vadinar in Gujarat, and a 943 km-long cross-country crude pipeline from Vadinar to Bina.

The project which has faced rough weather for getting environmental clearances has now been placed on fast track.

Another three MMTPA grassroots refinery is being set up at Numaligarh in Assam, in a joint venture with the IBP Company Limited and government of Assam. The project cost estimated at Rs 24.89 billion, has a foreign exchange component of Rs 4 billion.

More than 94 per cent of the project is complete and is scheduled to be commissioned by December 1998.

The third major oil refinery that the company is working on is a seven MMTPA grassroots refinery in Uttar Pradesh. Sundararajan said that the joint venture is being proposed with Shell at an estimated cost of Rs 70.7 billion, including a foreign exchange component of Rs 20.2 billion.

BPCL has also focussed on increasing its market share in the aviation fuel sector. The company, which has now 15 aviation fuelling stations, will construct three more stations at Bhubaneswar, Cochin and Jaipur. BPCL sales to aviation customers account for 2.9 per cent of sales while its stake in the total aviation fuel turbine market is 22.51 per cent.

Talking about the results, he said, BPCL in 1997-98 achieved the highest refinery throughput, sales turnover and profits. The sales turnover during 1997-98 was Rs 206.98 billion, achieving a growth of 3.83 per cent which was higher than the industry growth of 3.57 per cent. The total market share of the company has moved upto 20.5 per cent from the earlier 15.3 per cent.

The gross profit before interest, depreciation and tax increased by 24.2 per cent to Rs 12.14 billion. The net profit increased by 23.1 per cent to Rs 5.33 billion. The board of directors has recommended a dividend of Rs 5 per share.

Sundarajan said to face the unprecedented challenges post deregulation, the company has embarked upon an organisational restructuring exercise last year. The redesigned structure comprising strategic business units, put in place in May 1998, will effectively focus on specific customer segments.

BPCL is also continuing its pioneering efforts to upgrade and modernise its retail network by commissioning 13 more retail outlets conforming to international standards. The retail business constitutes 63.2 per cent of the total sales.

To increase its network, the company in March 1998, completed its Bombay-Manmad product pipeline. The estimated cost was Rs 4.44 billion. During the year it entered into fuel supply agreements with 22 independent power plants and four captive power plants for the supply of 1.1 MMTPA of naptha and 0.8 MMTPA of furnace oil.

UNI