As BPCL goes for privatization, India sees rise in fuel prices
Mumbai – The disinvestment of Bharat Petroleum Corporation (BPCL) may hit a fuel price hurdle since the state-run refiner in the process of being sold by the Indian government, plans to spend Rs 99,650 crore over the next five years to expand and diversify its businesses.
Explaining the areas of investment, the company outlined that the bulk investment will be in five areas: petrochemicals, natural gas, electric mobility, consumer retailing, renewables and bio-fuels.
Chairman Arun Kumar Singh said in a virtual conference that the energy landscape is changing fast and energy transition toward a low-carbon future has accelerated and BPCL is actively exploring new business opportunities for futuristic growth.
A senior oil ministry official said public-sector oil-marketing companies (OMCs) take a hit when they sell petrol, diesel, and liquefied petroleum gas (LPG). These are top three petroleum products in the country and all the oil firms can recover this hit over the course of time only when crude oil prices surges a little.
Although, one should keep in mind that refiners globally are betting big on plastics and renewables as they seek to diversify from an increasingly challenging fuels business and a global push for cleaner energy. Even Indian Oil Corp, which is BPL’s competitor, is now spending billions of dollars to build an industry around decarbonization.
BPCL is also reported to invest Rs 30,000 crore in petrochemicals to make propylene and ethylene derivatives, and another Rs 20,000 crore to expand its gas business, including retailing of liquefied natural gas as a transportation fuel.
Chairman concluded the conference by saying that the nation’s second-biggest fuel retailer also plans to convert a bulk of its fuel stations into energy stations, providing multiple fueling options including electric vehicle charging and hydrogen.