India’s BPCL to Invest $11bn in Refinery, Petrochemical Complex
Bharat Petroleum Corporation Ltd (BPCL), India’s second-largest fuel retailer, has unveiled plans to invest up to $11 billion in constructing a state-of-the-art refining and petrochemical complex in southern India. This development was revealed by the company’s chairman in a recent interview with Reuters.
“We feel there is a big opportunity in refining sector. India’s primary energy demand itself is also going to increase three to four times as its economy expands,” BPCL chairman G. Krishnakumar told Reuters this week.
Progress on the Project
BPCL has initiated preliminary activities for the project, including the acquisition of land. The facility, to be located in the southern state of Andhra Pradesh, will feature a refinery and an ethylene cracker with a processing capacity of at least 9 million metric tons annually.
Expanding Capacity to Meet Rising Demand
BPCL, which currently operates three refineries across India, is among several Indian refiners aiming to expand crude processing and petrochemical capabilities. This push comes in response to surging demand in India, the world’s third-largest crude oil importer. Earlier this month, BPCL’s Head of Refining, Sanjay Khanna, announced plans to increase the company’s refining capacity by 10 million tons annually by 2028.
India Leads Global Oil Demand Growth
India’s oil demand has already outpaced China’s in 2024, according to the U.S. Energy Information Administration (EIA). In its December Short-Term Energy Outlook (STEO), the EIA reported that India would account for 25% of global oil demand growth this year and next.
This year, India’s oil consumption is expected to grow by 220,000 barrels per day (bpd), significantly higher than China’s 90,000 bpd. Projections for 2025 indicate further growth, with India’s demand increasing by 330,000 bpd compared to China’s 250,000 bpd. Despite a rebound in China’s growth rate, India will maintain its position as the top driver of global oil demand.
A Milestone for India’s Energy Sector
India’s emergence as the leading contributor to global oil demand growth has occurred earlier than many analysts had anticipated. This development underscores the country’s expanding energy needs and its pivotal role in the global oil market.
