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March 18, 2007 at 8:13 pm #4035
Bharat Petroleum Corporation (BPCL), the country`s third largest refiner, is planning to spend Rs 3.9 billion to upgrade its refinery at Mumbai to produce Euro-IV standard petrol and diesel, reports Business Standard.
A BPCL (Q, N,C,F)* spokesperson said that the upgradation of the 12 million tonne per annum refinery is in pipeline. “Production of Euro–IV petrol and diesel from the Mumbai refinery is expected to begin by January 2010“ the spokesperson said.
The upgraded refinery will cater to Mumbai`s demand for high quality transportation fuels. “If the fuel quality upgradation were not carried out, the petrol component would have to be downgraded to naphtha and diesel, to light diesel oil. This would result in loss of revenue“ a BPCL official said.
The company is planning to fund the upgradation of project through a debt and equity ratio of 2:1. It has planned to spend Rs 590 million in the first year of upgradation, that is the current financial year. And than Rs 980 million, Rs 1.76 billion and Rs 590 million in the second , third and fourth year respectively.
Once the upgradation of the Mumbai refinery is complete, BPCL would earn Rs 886 million a year in revenues. The company is also spending another Rs 20 billion on implementing a delayed coker unit with 7.5 million tonne per annum in Kochi refinery. A delayed coker is used to refine low-quality heavy crude oil to lighter products.
All public sector crude oil refining companies are planning to invest up to Rs 500 billion to upgrade their old refineries in order to increase efficiencies and to make the country the “world`s refinery hub“.
Recently the company signed a farm-in agreement on Mar. 13, 2007, for acquiring a participating interest in the North Sea (UK) blocks 48/1b and 48/2c.
The shares of the company closed at Rs 295.75, down Rs 2.05 or 0.69%. The total volume of share traded was 24,236 on BSE (Thursday).
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