BPCL takes full control of BORL’s Bina refinery

April 26, 2021

Bharat Petroleum Corp. Ltd. has bought out joint-venture partner OQ SAOC (formerly known as Oman Oil Co. SAOC) to take 100% ownership of equity share capital in Bharat Oman Refineries Ltd. (BORL), which includes the 7.8-million tonnes/year refinery at Bina, Madya Pradesh, India.

As part of the deal finalized on Mar. 31, BPCL—which previously held 63.38% interest in the JV—purchased OQ’s 36.62% equity shares for 23.99 billion rupees, BPCL said in Apr. 1 filings to BSE Ltd. and National Stock Exchange of India Ltd. (NSEI).

Acquisition of OQ’s equity shares in BORL comes as part of BPCL’s ongoing exercise of consolidating its group companies, which also will include the planned merger of BPCL’s existing wholly owned subsidiary Bharat Gas Resources Ltd. into the main company, according to separate BPCL filings to BSE and NSEI in December 2020.

In a series of posts to its official social media accounts, OQ said divestment of its shares in BORL aligns with the operator’s rationalization program that aims to help OQ to maximize value of its local and international investments.

BPCL, which now holds 100% of equity share capital in BORL on a nondiluted basis, informed BSE and NSEI on Dec. 15, 2020, that it also is considering acquisition of the government of Madhya Pradesh’s 26.9 million convertible share warrants in BORL.

During fiscal year 2019-20, BORL expanded it basket of crude feedstocks processed at the site to 23 as well as implemented a series of projects to boost the refinery’s operational performance, according to the company’s latest annual report.

Alongside importing a record 8.3 million tpy of crudes mostly from Saudi Arabia, Iraq, and Kuwait as part of its plan to optimize processing rates beyond 8 million tpy, the Bina refinery also added a variety of new crudes to its processing slate, including volumes of Azeri Light from Azerbaijan, Kissanje from Angola, West Texas lntermediate (WTl) Light from the US, Arab Extra Light from Saudi Arabia, as well as Lula and Sapinhoa crudes, both from Brazil.

While the refinery undertook multiple performance and reliability improvement initiatives to enhance operational efficiency and profitability, BORL completed several major projects during 2019-20:

  • Addition of a kerosine hydrodesulfurization unit. Part of BORL’s strategy to reduce output of kerosine, the new unit is designed to reduce sulfur content of kerosine to make it compatible for blending in Bharat Stage (BS) 6- grade (equivalent to Euro 6-quality) high-speed diesel, supplement aviation turbine fuel production, and help meet revised regulatory specifications for kerosine.
  • Addition of a third coke drum to delayed coking unit. Integrated with the delayed coker’s existing two coke drums, the new drum improves the unit’s distillate yield as well as its overall reliability.
  • Addition of a vacuum pressure swing adsorption (VPSA) oxygen plant. Consisting of two 91-tonnes/day units, the new VPSA plant is designed to increase utilization of the refinery’s three sulfur recovery unit trains to 245 tonnes/day each from 180 tonnes/day each.

As part of a revamp project, BORL said it also commissioned new units for condensate polishing and reverse osmosis at Bina during 2019-20.

Divestment of NRL

In addition to its takeover of BORL, BPCL recently completed divestment of its interest in Numaligarh Refinery Ltd.’s (NRL) 3-million tpy Numaligarh refinery in the Brahmaputra valley of Assam’s Golaghat district, in far-northeastern India.

As part of a deal inked on Mar. 25, BPCL sold most of its 61.65% interest in NRL to a consortium of government-owned Oil India Ltd. (OIL) and Engineers India Ltd. for a total consideration of 98.76 billion rupees, BPCL said in Mar. 26 filings to BSE and NSEI.

The operator said it will transfer the remainder of its shares in NRL to the government of Assam upon receipt of consideration of about 5 billion rupees, according to the filings.

OIL and the government of Assam previously held 26% and 12.35% interests, respectively, in NRL (OGJ Online, Feb. 9, 2021).