Bharat Petroleum Corporation Ltd (BPCL), one of India's leading oil marketing companies, is evaluating the establishment of a greenfield refinery-cum-petrochemical complex near Ramayapatnam Port in Andhra Pradesh. This strategic move was unveiled during BPCL's 72nd Annual General Meeting (AGM), as the company charts an ambitious course for expansion and sustainability.

Greenfield Refinery Project

The proposed facility in Andhra Pradesh is expected to be a 9 million tonnes per year unit with an estimated cost of Rs 95,000.00 crore. This significant investment aligns with BPCL's vision to expand its petrochemical portfolio and contribute to India's goal of becoming a global refining and petrochemical hub. Pre-project activities for this strategic investment are already underway, signaling BPCL's commitment to bolstering India's energy infrastructure.

Expansion and Investment Strategy

BPCL's Chairman and Managing Director, Sanjay Khanna, highlighted the company's multi-year capital expenditure cycle during the AGM. Key developments include:

• A major upgrade of the Mumbai Refinery, replacing existing units with a state-of-the-art Petro Resid Fluidized Catalytic Cracking Unit (PRFCC) at an investment of Rs 14,200.00 crore.
• Two significant petrochemical projects at Bina and Kochi, with a combined capital investment of Rs 54,000.00 crore, progressing on schedule.
• Securing a Rs 31,802.00 crore loan agreement with the State Bank of India Consortium for the Bina project, marking the largest in BPCL's history.

Operational Highlights

The company reported robust performance:

• Achieved the highest crude throughput of 40.5 MMTPA across its refineries.
• Recorded market sales of 52.4 MMT, maintaining its position as the second-largest PSU OMC with a 27.44% market share.
• Posted a standalone net profit of Rs 13,275.00 crore, the highest among PSU oil marketing companies.
• Attained the highest-ever capital expenditure of Rs 16,967.00 crore, a 45% increase over the previous year.

Focus on Sustainability and Green Energy

BPCL reaffirmed its commitment to sustainability and green energy initiatives:

• Aims to achieve Net Zero Scope 1 and Scope 2 greenhouse gas emissions by 2040.
• Plans to build a renewable energy portfolio of 10 GW by 2035.
• Commissioned a 5 MW electrolyzer unit for green hydrogen at Bina Refinery.
• Increased ethanol blending to 16.35%, nearing the 20% national target.

Financial Performance and Shareholder Returns

The company's financial performance remained strong:

• Turnover exceeded Rs 5 lakh crore.
• The Board recommended a final dividend of Rs 5.00 per share, bringing the total dividend for the year to Rs 10.00 per share.

Future Outlook

As BPCL enters its golden jubilee year, the company is poised for transformative growth. The proposed Andhra Pradesh refinery, along with ongoing projects and green initiatives, underscores BPCL's commitment to energizing India's future while aligning with the nation's vision of becoming a developed country by 2047.

Chairman Sanjay Khanna emphasized, "As we scale new horizons across business segments, we are strengthening our workforce through the largest talent induction in recent years. Every rupee of capex is a promise, and timely commissioning is how we honour it."

With these strategic moves, BPCL is not only expanding its operational capabilities but also positioning itself as a key player in India's energy transition and economic growth story.

Bharat Petroleum Corporation Limited (BPCL), one of India's leading oil and gas companies, is actively diversifying its oil procurement strategy while reporting robust financial results for the first quarter. The company also provided insights on auto fuel prices and LPG compensation.

Shifting Oil Procurement Strategy

BPCL executives announced during a recent conference call that the company is exploring alternative markets for crude oil due to reduced discounts on Russian oil. The state-owned refiner is now looking to increase its oil purchases from Brazil, the United States, and West Africa as part of its diversification efforts.

This strategic shift comes as Indian refiners, who had been enjoying discounted rates on Russian crude following Western sanctions, are now facing less attractive pricing. The move highlights BPCL's agility in adapting to changing market dynamics to ensure a stable and cost-effective supply of crude oil.

Strong Financial Performance

Alongside its procurement strategy update, BPCL has released its financial results for the quarter ended June 30, showcasing impressive growth:

• Net Profit: BPCL reported a net profit of ₹6,123.93 crore for Q1, more than doubling from ₹3,014.77 crore in the same quarter last year.
• Revenue: The company's revenue from operations stood at ₹1,29,577.89 crore, slightly higher than ₹1,28,072.80 crore in the corresponding quarter of the previous year.
• Earnings Per Share (EPS): The basic and diluted EPS for the quarter was ₹14.33, compared to ₹7.06 in the corresponding quarter of the previous year.

Operational Highlights

BPCL's operational performance for the quarter was also noteworthy:

Financial Position

The company's financial position remains strong:

Management Commentary

VRK Gupta, Director (Finance) and Whole Time Director of BPCL, commented on the results, stating, "Our strong financial performance this quarter reflects BPCL's resilience and adaptability in a dynamic market environment. We are actively diversifying our crude oil sources to ensure supply security and optimize costs, which will contribute to our long-term sustainability and growth."

Auto Fuel Prices and LPG Compensation

BPCL management has indicated that auto fuel prices are unlikely to decrease in the near term due to ongoing geopolitical instabilities. This suggests that consumers should not expect significant relief in fuel costs in the immediate future.

Additionally, the company expects to receive 25-26% of total LPG compensation from the government. This compensation is likely related to the subsidies provided for domestic LPG cylinders, which helps in maintaining affordable cooking gas prices for consumers.

BPCL's proactive approach to oil procurement, solid financial results, and insights on fuel pricing demonstrate the company's commitment to maintaining its competitive edge in the evolving global energy landscape. As BPCL continues to adapt its strategies, investors and industry observers will be keenly watching how these moves impact the company's performance in the coming quarters.