Oil Minister Dharmendra Pradhan said India planned to raise its refining capacity, indicating the country’s dependence on hydrocarbons and fossil fuel, adding that fuel demand was expected to to reach pre-COVID-19 levels in the first quarter of the 2021 calendar year.
“India currently has an oil refining capacity of around 250 million tonnes per annum (MTPA). In the next decade, we want to add another 100 million tonnes. Looking at our demand, we must have 350 million tonnes refining capacity by 2030,” he told the Energy Intelligence Forum 2020 earlier this week.
He also said there was no scaling down of the capacity of the planned mega 60 MTPA refinery on the west coast as it was essential to meet future fuel and petrochemical demand in the country.
Pradhan also said the privatization of Bharat Petroleum Corp Ltd (BPCL) was very much on track but the government was treading cautiously given the size of the divesture. The government, which is selling all of its 51.11 per cent stake in BPCL, has already postponed the initial bid deadline four times and the expression of interests are now due next month.
At current prices, the government stake is worth Rs 37,600 crore and the buyer will also have to make an open offer to acquire an additional 26 per cent from the public which will cost another Rs 19,000 crore.
India, the world’s third-largest oil consumer, is likely to see fuel consumption double by 2050 despite the push for renewables and alternate sources of energy such as battery-run vehicles or EVs.
The minister said India, which earlier offered billions of dollars of subsidy on fuels, has cut them to almost zero this year. While subsidies on petrol were eliminated in 2010, those on diesel went in 2014.
This year, the remaining subsidies on cooking gas (LPG) and kerosene have been eliminated largely due to international oil prices plummeting on the pandemic eroding demand.