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Bharat Petroleum Corp Ltd (BPCL) Of India To Make An Investment Of USD 5bn-6bn For Its Bina Refinery, Petrochemical Complex

India-based Bharat Petroleum Corp Ltd (BPCL) to invest INR 430 billion-500 billion (USD 5.2 billion-6.1 billion) for expanding its Bina refinery in the central Madhya Pradesh state and constructing a petrochemical complex at the location.

BPCL got the required approvals for the project from the Madhya Pradesh state government, as stated by the company in a regulatory filing to the Bombay Stock Exchange (BSE).

The plan for the construction of the petrochemical complex is anticipated to produce polypropylene (PP), linear low-density polyethylene (LLDPE), high-density polyethylene (HDPE), benzene, bitumen, along with gasoline, diesel price and ATF (aviation turbine fuel), as per a statement.

The firm predicts commissioning the undertaking by the fiscal year ending March 2028.

Bharat Petroleum Corporation (BPCL) had plans to make significant investments in petrochemicals. The company has been in feasibility studies and other pre-project processes since last year to construct an ethylene cracker project at Madhya Pradesh's Bina Refinery, along with a polypropylene project at Kochi Refinery in Kerala.

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The plan was to be set in motion as soon as the company received environmental clearance and was subject to conclude construction in a period of four years by 2026. The complex, upon being operational, could raise the company's proportion range of petrochemicals to around 8% compared to the current 1%, and the margins in the industry are beneficial.

In a report to the Ministry of Environment, Forests and Climate Change in June 2022, BPCL conveyed its plans for the expansion of its Bina refinery's capacity from 7.8m tonnes/year to 12m tonnes/year by more than half.

The planned complex will include a 1.2m tonne/year ethylene capacity cracker; a 650,000 tonne/year polypropylene (PP) line; a 500,000 tonne/year HDPE unit; a 650,000 tonne/year LLDPE/HDPE swing plant; and a 50,000 tonne/year butene-1 unit.

This movement is a key element for the six strategic sectors which are identified as the corporation's pillars of future growth as the globe shifts from fossil fuels to renewable energy: gas, renewables, petrochemicals, new companies, i.e., e-mobility, consumer commerce, and upstream.

The company is following a well-detailed roadmap that is under development with the help of a leading expert, and it comprises crucial milestones that must be achieved at some points down the road. BPCL aims to have net-zero emissions by 2040.

Bina Refinery: About

The BPCL Bina Refinery was established in the year 1994 as a Joint Venture between Bharat Petroleum Corporation Limited and OQ SAOC (previously known as Oman Oil Company SAOC) to establish a central India refinery under a bilateral contract.

With considerable support from the Government of Madhya Pradesh, Bina Refinery established a six million tonnes per annum (6.0 MMTPA) grassroots petroleum refinery at Bina, Bundelkhand, Madhya Pradesh. The refinery made environmentally compliant fuels of BS-VI grade.

Since their authorisation, the firm has achieved major goals and grown its capacity further to 7.8 MMTPA in 2018-19 to cater to its industry's petroleum product demand. Also, it has future plans in the Petrochemical business.

In 2021, the firm became Bharat Petroleum Corporation Limited's wholly owned subsidiary- a 'Maharatna' Public Sector Unit of the Government of India and a Fortune 500 company with a downstream, midstream, and upstream presence in the oil & gas sector.

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According to the article on the recent BPCL expansion by Procurement Resource, it can be concluded that the company has been looking to invest in the expansion of its Bina refinery since last year and has been awaiting the necessary clearances from the Madhya Pradesh government to establish its latest petrochemical complex on the site.

The company has made an investment of USD 5-6 billion for the construction of the petrochemical complex. The petrochemical complex is anticipated to produce polypropylene (PP), linear low-density polyethylene (LLDPE), high-density polyethylene (HDPE), benzene, and bitumen, along with gasoline, diesel and ATF (aviation turbine fuel). Additional details of the recent investment have been detailed.