State-owned Hindustan Petroleum Corp has charted out plans to invest Rs 90,000 crore till 2030 with a significant portion of the funds to be allocated for building a green energy portfolio, the company’s chairman and managing director Rajneesh Narang tells media in an interview. The company is also exploring opportunities for oil and gas deals with the US entities given the country’s plans to buy more energy products from the country announced during the recent visit of Prime Minister Narendra Modi to Washington. With the rising domestic demand, the company is also looking to increase the capacity of its Vizag refinery by 20%. Excerpts:
Last year, Russian crude had accounted for 35-40% of our total crude imports. Even before the Russian Ukraine war, our refineries were operating. So there is sufficient crude available, there’s no dearth of crude oil. How did Russia fit into the entire scheme of things when is they started giving discounts. When we procure crude, we take a decision of buying the crude based on its economics, the value it creates in our system. So long, the discounts were good and procurement of Russian crude was adding value in our system Now, post the US sanctions we have already tied up our crude supplies up to February. Since the sanctions had come up, the availability of Russian crude had declined. But we need to give them time to settle down as to how it figures out and how the crude will ultimately flow into this part of the region
We have tied up (for crude volumes) as far as the crude requirement for April and May is concerned. And as and when an opportunity comes out, tomorrow, and if Russian crude is available, we will go for it.
Off late, the discount also had narrowed down. So, it is not going to significantly impact the performance of the company, or profitability. Because Russia had significantly narrowed its discounts and with the US making a statement that they will not subscribe to the greening and increase oil production, more oil is going to come on the platter.
When we finalise strategies, we evaluate all the crudes and and the crude which gives us greater value is the one which we tie up for. We do it on a term or spot basis and keep on evaluating the pros and cons. As far as the US is concerned, going forward, there’s going to be an opportunity to buy oil and gas and for tying up for LNG supplies
This year we are targeting between Rs 12,000-14,000 crore. And that would be the range for the next fiscal year too. Up to 2030, we have plans to spend almost Rs 90,000 crore. Of this Rs 90,000 crore, almost 30-35% of the amount would be spent towards clean energy.
The Mumbai refinery was expanded to 9.5 million tonnes and we are already running it at 9.8 million tonnes. Our Vizag refinery was expanded from 8.3 million tonnes to 15 million tonnes. We have already been operating it at 15 million tonnes. The third major thing was the bottoms upgradation at Vizag refinery. The mechanical completion for our residue upgradation unit has already been achieved and we are in the process of commissioning this facility by March or April. Once that is in place, we’ll be able to improve our margins and the distillate yield. We are also increasing the capacity of the Vizag refinery by almost 20% from 15%.
We are undertaking the lube expansion at Mumbai refinery at a cost of Rs 4,700 crore and are also setting up a deasphalting plant, which will make more Bitumen. India is consuming almost 8.6 million tonnes of bitumen, whereas the refineries produce only 5.2 million tonnes. The balance is getting imported. Not only will it lead to more import substitution, but it will also improve my distillate of the refinery and we may add around $3 per barrel as margin. We expect this to come up by FY27.
The Barmer refinery has already achieved physical progress of more than 84% and we will be commissioning this facility in this calendar year 2025. To start with, we will be commissioning the refinery section first, followed by the petrochemical section. The refinery is a 9 million metric tonnes refinery with a petrochemical intensity of 26%.
We also market HMEL’s (HPCL-Mittal Energy Ltd) products. Their throughput is more than 12.5 million tonnes. After adding that, our name plate cumulative capacity is 46 million tonnes but we can make up to 50 million tonnes.
In regard to the marketing, the major project which we have taken is a recent commissioning of our 5 MT LNG facility in Gujarat. This will give us a strong foothold in the gas market.
Today, we are buying gas domestically, and this will give us an opportunity to tie up long-term sources and bring LNG into the country. We are already in the market exploring opportunities for tying up a long-term LNG deal.
We ended FY24 with 200 MW RE capacity. This financial year, we may end up at 400 MW. By next year 2025-26, we will be crossing 1 GW and by 2030, our ultimate plan is to have a portfolio of 10 GW renewable energy capacity. In terms of biofuels, we have plans to touch 1 million tonnes.
Leave Comments