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BPCL’s Capex Seen Rising 51% in 2020-2021

Gasoil News - Published on Thu, 22 Aug 2019

Image Source: Business Line
Executives told analysts during the first quarter conference call that Bharat Petroleum, the country’s second largest fuel retailer, plans to spend close to INR 12,120 crore next financial year (2020-2021), a 51 per cent jump over INR 8,000 crore planned as capex in the current fiscal ending March 2020. Of the INR 12,120 crore to be spent next financial year, INR 4,000 crore will be spent on refinery operations, INR 3,000 crore on petrochemical projects, INR 670 crore under pipeline division, INR 2,800 crore on marketing, INR 1,200 crore on upstream operations and INR 450 crore for gas and City Gas Distribution business. The company is spending close to INR 8,000 crore in the current financial year (2019-2020) including INR 1,825 crore on petrochemical projects, INR 300 crore under pipeline division, INR 2,500 crore on marketing, INR 200 crore on CGD and gas business, INR 800 crore on upstream operations and the remaining on research and development as well as investments in JVs.

Speaking on the company’s plans on Numaligarh refinery, executives at BPCL said, “The Board has approved our investment in the Numaligarh refinery expanding its capacity from 3 million tonnes to 9 million tonnes at an investment of about INR 22,000 crores. We find two reasons to justify this investment: one is that the eastern side of the country, the growth in product consumption is much, much higher than what we experienced in the -- compared to other places. And secondly, we expect to get and continue to get the benefit of excise duty benefits, which is available to (inaudible) refiner”

Executives at the company told analysts that all major contracts for the Mozambique project have been awarded and the company at a consolidated level expects capex for the projects to be around USD 2.5 billion.

BPCL executives said that “BPRL will be able to raise its own loans for funding the Mozambique investment. Our CapEx only captures the equity contribution which is required to be given to BPRL in the first year. Mozambique FID has been announced, and we expect at the consolidated level to incur a CapEx of about USD 2.5 billion up to 2023-24.”

Source :

Posted By : Sanju Moirangthem on Thu, 22 Aug 2019
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