Petroliam Nasional Bhd (Petronas) of Malaysia and an association controlled by Japan’s JXTG Holdings Inc are amongst the corporations involved in purchasing stock in India’s Bina oil refinery.
BPCL has strategized to double the volume of the refinery in next five year. It plans to build a petrochemical complex. This would need an investment of about 500 billion rupees (RM30 billion). “There are a new set of companies who have approached BPCL for a stake in its Bina refinery,” said the unidentified source.
Oman Oil did not take part in the initial round of expansion even after primarily investing in the 120,000 bpd plant. India permitted BPCL in 2016 to issue debt instruments of up to 30 billion rupees to be transformed into equity of BORL to fund the primary development to 156,000 bpd. Oman Oil is in two minds whether to invest in a second round or not, the source claims. And it added that even if Oman takes part in the development, its complete stake would not convert to a 50% share.
It had not funded the former growth. Now, BPCL wants to preserve a 50% share in the plant. Thus a new partner will be needed. Middle Eastern company will confirm the percentage of stake it wishes to hold in, about three months of time. The rest will be retailed.
Seeing this opportunity, Global oil producers are competing to gain access in India to profit from high gasoline and petrochemical demand. Many are even pushing for an oil refining course for their employees to gain more benefits from the clear understanding. An association led by Russia’s Rosneft attained a governing stake in Nayara Energy. It was previously known as Essar Oil. This deal took nearly US$13 billion in 2017. Saudi Aramco wants to acquire a marginal stake in Reliance Industries’ refining, marketing and petrochemical business.
Prime Minister Narendra Modi’s government had said earlier that India (world’s third-biggest oil importer) wants to increase its refining capability by 77% to about 8.8 million bpd by 2030 to meet rising fuel demand.
The Bina plant in central India is capable of dispensing 156,000 barrels per day (bpd) of crude oil. It is operated by Bharat Oman Refineries Ltd (BORL), a 50-50 joint venture between Oman Oil Co and state-run Bharat Petroleum Corp Ltd (BPCL).
Bharat Petroleum does not want to comment on this.