Published: January 25, 2025 4:19 PM IST 
State-owned Bharat Petroleum Corporation Ltd (BPCL) will set up India’s costliest oil refinery-cum-petrochemical complex in Andhra Pradesh at an estimated cost of Rs 95,000 crore. The proposed refinery will have a capacity of 9 million tonnes per annum (crude oil processing capacity) and produce 3 to 3.5 million tonnes of petrol and diesel and 3.8 to 4 million tonnes of feedstock of petrochemicals annually, according to officials.
In an investor call with analysts post announcement of third quarter earnings, BPCL Director (Finance) Vetsa Ramakrishna Gupta said the company’s board has approved an expenditure of Rs 6,100 crore on pre-project activities such as land acquisition and commissioning of detailed project report (DPR) and certain feedstock studies.
“Roughly the initial indication of capex requirement will be around Rs 95,000 crore at gross level,” Gupta said, adding the Andhra Pradesh government has also indicated a good amount of capital subsidy incentives. However, he did not indicate the fiscal support from the state government.
“We will come to a final number in December when DPR and feed study will be over. Parallelly, we are exploring (to induct) a joint venture partner,” the BPCL Director said, without providing any details.
Giving details of the refinery, Gupta said the project will be a coastal refinery and land has been identified. “We are looking for 6,000 acres of land… land has been identified and an acquisition process has to start,” he said, adding that the refinery is likely to be commissioned in 48 months from the final investment decision (FID), and it will take 6 to 9 months to complete DPR and feedstock studies to be carried out.
This will be India’s costliest refinery project so far with Hindustan Petroleum Corporation Ltd (HPCL) set to commission a similar size unit at Barmer in Rajasthan at a cost of Rs 71,814 crore later this year.
An oil refinery and petrochemical complex, with a mega capacity of 60 million tonnes, to be built at a cost of Rs 3 lakh crore, was proposed in Ratnagiri, Maharashtra, during the Narendra Modi government’s first term, but the project was shelved because of land acquisition issues.
BPCL is India’s third largest oil refiner behind state-owned Indian Oil Corporation (IOC) and Mukesh Ambani-led Reliance Industries Ltd. It currently owns refineries at Mumbai (12 million tonnes a year capacity), Kochi in Kerala (15.5 million tonnes) and Bina in Madhya Pradesh (7.8 million tonnes). It had lost a fourth oil refinery to Oil India Ltd in the aborted privatisation plan.
The public sector company had to give up its Numaligarh refinery in Assam to Oil India Ltd when the government was attempting to privatise it. The transfer was to keep the Numaligarh unit within the public sector to honour the Assam Accord. But BPCL privatisation was aborted due to lack of interest by bidders.
BPCL was also part of a consortium that was pursuing a 60 million tonnes a year refinery-cum-petrochemical complex on west coast in Maharashtra that was conceived more than six years back but is yet to get off the drawing board due to land acquisition woes.
India — the world’s third largest oil consuming and importing nation — has a refining capacity of 256.8 million tonnes and publicly announced plans for expanding current units and a near complete 9 million tonnes facility at Barmer in Rajasthan of HPCL will take it to 300 million tonnes by the end of the decade.
India’s nearly two dozen refineries produced 276.1 million tonnes of fuel in 2023-24 fiscal (April 2023 to March 2024) while domestic consumption was 234.3 million tonnes. The rest of the products were exported.
(With PTI inputs)
For breaking news and live news updates, like us on Facebook or follow us on Twitter and Instagram. Read more on Latest Business News on India.com.
Follow Us 
By 
