Privatisation-bound PSU refiner Bharat Petroleum Corporation Ltd. (BPCL) has delayed expansion plans for its refinery projects, pending its share sell off programme that will see government completely exiting from the company and handing over its management to a strategic investor.
BPCL has plans to expand its Bina refinery and take efficiency improvement measures at Mumbai refinery. But investment decisions on both the projects are now left for the new owners in the company that is expected to take control after the current bidding process ends, sources said that a senior BPCL officials told analysts at a recent post results conference call.
The Bina Refinery expansion involves taking up its capacity from present 7.8 million tonne to 15 mt over next five years with an investment of over Rs 30,000 crore. Plan is also to set up a petrochemicals unit with a 1.5 mtpa naphtha cracker.
With regard to Mumbai refinery the plan is to connect the unit with an ethylene cracker plant set up at an alternate location.
These expansion plans will now be kept on the back burner till clarity emerged over the company’s new owners.
Government is selling its entire 53.29 per cent stake in BPCL to a strategic investor to mobilise over Rs 50,000 crore as disinvestment receipt. This will help in containing country’s rising fiscal deficit that is slated to these clause to 8 per cent of GDP due to adverse impact of Covid-19 pandemic.
The strategic sale process at this juncture has not been easy as initial bidding date under the process being already postponed on four occasions. The latest EoI submission date is November 16.
Sources said that BPCL official, during the analyst call, put complete toon of sale process by the end of current fiscal year as challenging because any worsening of pandemic situation would curb travel required to assess its assets by potential investors.