BPCL Secures LNG Supply Deal with ADNOC
State-owned Bharat Petroleum Corporation Limited (BPCL) is set to enter a five-year LNG deal with Abu Dhabi National Oil Company (ADNOC), commencing in the financial year 2026. The move aligns with BPCL’s broader strategy to strengthen its refinery and petrochemical business while expanding its footprint in exploration and production ventures overseas.
During the India Energy Week conference, BPCL’s Director of Finance, Vetsa Rama Krishna Gupta, revealed that the company has completed exploration activities in Brazil and has initiated the tender process for field development, expecting the process to conclude by mid-2025. Additionally, the company is optimistic about resuming operations in Mozambique once force majeure conditions are lifted, reinforcing its commitment to overseas investments.
Massive Capex Plans and Refinery Expansion
BPCL has earmarked a capital expenditure (capex) of ₹1.7 lakh crore over five years starting from FY25, partly due to the five-year LNG deal. With a significant portion directed towards petrochemicals, the company aims to increase its petrochemical business share from the current level of under 2% to around 7-8%.. To achieve this, BPCL has announced a ₹50,000 crore expansion of its Bina refinery and is considering establishing another integrated refinery and petrochemical complex in Andhra Pradesh.
Out of the total planned capex, ₹75,000 crore is allocated for petrochemical projects and refinery capacity expansion. The company also plans to invest ₹25,000 crore in city gas distribution and gas infrastructure development, alongside an additional ₹25,000 crore for exploration projects in Brazil and Mozambique. Another ₹10,000 crore is designated for renewable energy projects, reflecting BPCL’s strategic shift towards cleaner energy sources.
Expansion into Renewable Energy and Fuel Alternatives
BPCL is aggressively diversifying into renewable energy, having formed a 50:50 joint venture to develop 3.5-4 gigawatts of green energy assets. The company is also venturing into biofuels, partnering with GPS Renewables for joint biofuel production initiatives.
Additionally, BPCL is exploring coal gasification projects in collaboration with Coal India. The plan involves converting coal into syngas, which can then be transformed into natural gas. This initiative will be based near Chandrapur in Maharashtra, marking a significant step towards alternative fuel production.
BPCL, following the five-year LNG deal, aims to expand its retail network by adding 800-1,000 fuel stations over the next one to two years, supplementing its existing 20,000 outlets.With these aggressive expansion strategies, the company is positioning itself as a key player in both the traditional and renewable energy sectors, ensuring sustained growth in the evolving energy landscape.
