Modi 3.0: BPCL privatisation completely off the table, high revenue PSUs need not be sold, says Hardeep Singh Puri 

Union Minister for Petroleum & Natural Gas Hardeep Singh Puri on Tuesday said that the plans to privatise state-owned Bharat Petroleum Corporation Ltd (BPCL) has been shelved for now. Speaking to BT TV, Puri said that the high revenue earning public sector undertakings need not be sold.

"BPCL has made more money in the first 3 quarters than the stake sale amount," Puri said while assuming charge of the Petroleum and Natural Gas ministry. BPCL made a net profit of over Rs 19,000 crore in the first half of financial year 2024.

In Q3 FY2024, BPCL reported an 82% surge in its consolidated net profit at Rs 3,181.42 crore as compared to Rs 1,747.01 crore in the same period in FY23.

Its revenue from operations was Rs 1.30 lakh crore in Q3 FY24 as compared to Rs 1.33 lakh crore a year ago.

The oil marketing company said its total expenses fell to Rs 1.26 lakh crore in the October-December period of fiscal year 2024 from Rs 1.31 lakh crore in the same quarter last fiscal year.

On May 9, 2024, BPCL reported a consolidated net profit of Rs 4,789.57 crore for the fourth quarter of the financial year 2023-24, a decline of 30% from last year. Its profit was Rs 6,870.47 crore in the same period last year.

The dip in profit of the company comes amid weakening margins and volatility in crude oil prices over the quarter. In mid-March, BPCL among other OMCs had slashed diesel and petrol prices by Rs 2 per litre in the country, which would also have impacted the company’s margins. BPCL's revenue from operations declined marginally to Rs 1.32 lakh crore in the quarter ended March 31, compared Rs 1.33 lakh crore last year.

The privatisation of BPCL, along with that of Air India, was on the NDA government’s disinvestment programme in FY22.

BPCL is India’s second-largest oil marketing company after Indian Oil, and with refineries in Mumbai, Kochi, and Madhya Pradesh, it has the third-largest refining capacity after Reliance and Indian Oil.

The Centre planned to sell its entire stake of 52.98% in BPCL, which was expected to fetch an estimated Rs 45,000 crore in FY22. The government invited Expression of Interest (EoI), or initial bids, for these in March 2020. The plan was to complete the process by March 2021.

Global majors such as Saudi Aramco, Abu Dhabi National Oil Co, and Exxon Mobil had shown interest at first in buying BPCL, but none of them submitted initial bids to buy the state-owned oil refiner.

Expansion plans

At present, BPCL is planning to set up a new 12 million metric tonnes per annum (MMTPA) refinery in the country, the Economic Times reported.

The state-run oil marketing company will invest around Rs 50,000 crore in the project and is currently assessing locations in three states — Andhra Pradesh, Uttar Pradesh, and Gujarat.

BPCL intends to invest Rs 1.7 trillion in oil refining, fuel marketing, petrochemicals, and clean energy over the next five years. This includes Rs 75,000 crore for refineries and petrochemicals, Rs 8,000 crore for pipelines, and over Rs 20,000 crore for marketing.