BPCL to Invest INR 1.4 Lakh Cr in Petrochemical, Gas and Clean Energy

India’s second largest downstream oil company, Bharat Petroleum Corporation Ltd (BPCL), is planning to invest INR 1.4 lakh Cr in petrochemicals, city gas and clean energy in the upcoming five years. The state backed company, in its annual report said, “We plans to diversify and expand in adjacent and alternative businesses to create additional revenue streams”.

However the comany's core focuss will be same as earleir, the announcement has been seen as as a major shift. BPCL has been engaged in the dowstream businesses of petroleum industry since its inception. The Company delivers liquefied petroleum gas, petroleum products, lubricants, aromatics like benzene and toluene, and other related products. Arun Kumar Singh is the current Managing Director and Chairman of BPCL.

The company also said that it plans zero carbon emission by 2040 saying, “Bharat Petroleum has been among the first corporate in India that have announced their 'Net Zero' plans. Our ambition is to achieve 'Net Zero' in Scope 1 and Scope 2 emissions by the year 2040 to curb the carbon footprint of our operations.”

An investment of around 1.4 lakh Cr has been planned to be pumped into six strategic areas to strengthen the company’s grip over the market. Those key areas are, Petrochemicals, Gas, Renewables, New Businesses (Consumer Retailing), E-mobility and Upstream. The company also clarified its plans to stay focused on the core businesses of refining and marketing of petroleum products.

“The era-defining trend of today for our industry is Energy Transition. As the energy landscape changes globally, our company has been recalibrating its strategies to leverage emerging opportunities while mitigating risks. The Company has firmed up plans to diversify and expand in adjacent and alternative businesses to create additional revenue streams. This investment will provide a hedge against any possible future decline in liquid fossil-fuel business.” He said.

Talking about the sales numbers and yearly profits (Profit After Tax) the firm said that it performed better than last year. In comparison of last year, when the company sold 26.40 MMT (Million Metric Ton ) of crude oil, the company has registered sales 30.07 MMT of crude oil in the year 2021-22.

“On the financial front, your Company recorded a Profit After Tax (PAT) of INR 8,789 Cr on a standalone basis, as against PAT of INR 19,042 Cr in the previous year. The higher PAT last year was essentially due to the one-time gain on the sale of stake in Numaligarh Refinery Limited. Besides, this year, the gains due to higher refining margins were more than offset by the lower marketing margins and lower inventory gains, resulting in a dampening effect on our profit.” Arun said.

Moreover, the company, with an aim to nurture its retail portfolio has formed a new business unit called “New Businesses”.  New Businesses will help it expand the customer retail business. Having core focus on small towns and rural areas, a cohort of non-fuel products has been launched along with fuel products. Women entrepreneurs called "Urja Devis" are enrolled for “New Businesses” to have a good reach at ground level market.

Arun, while informing  the growth said, “I am extremely happy to inform you that in just nine months since the creation of this business unit, we have already opened 30 "In & Out stores" in Tehsils and partnered with 300 Urja Devis in rural areas. Our endeavour is to create 1,500 "In & Out stores" and engage 15,000 Urja Devis in the coming year.”