HPCL Decides to Start Work at Rajasthan refinery

Increasing number of refineries coupled with expansion of existing refineries will fulfill the demand for LPG and other petroleum products in India.

India: In 2013, HPCL, a state-owned oil and natural gas company in India, had decided to construct a refinery in Balmer, Rajasthan where a MoU was signed between HPCL and Rajasthan government. The estimated cost of the project was around USD5.79 billion in 2013 and now it has increased to between USD6.37 billion and USD6.52 billion. Half of the crude required for the plant will be supplied by Cairn India and the rest will be imported. Currently, HPCL owns two refineries in Mumbai and Visakhapatnam and the project in Rajasthan is expected to increase demand in northern India.

TechSci Research depicts that rising demand from transport segment and increasing consumption of LPG to produce various chemical components such as propylene, ethylene, butadiene, etc., is anticipated to boost demand for LPG in the country in coming years. Furthermore, increasing prices of naptha, rising LPG imports and expanding distribution network are anticipated to fuel consumption of LPG in India during FY17-FY26.

According to released report by TechSci Research, “India LPG Market By End Use Segment (Residential, Commercial, Industrial, etc.), By Source (Crude Oil Distillation, NGL & LNG Fractionation, etc.), Competition Forecast and Opportunities, FY2012 - FY2026”, LPG consumption in India is forecast to surpass 35 MMT by FY26. North region comprises several LPG bottling plants, oil refineries and petrochemical plants. Moreover, residential segment accounted for a lion’s share in India LPG market in FY16, and the segment is anticipated to continue dominate the market through FY26. In order to increase availability of LPG in the country and foster competition, private sector was allowed to market LPG from April 1993, by decentralizing imports of such petroleum products.  This is anticipated to boost adoption of LPG in various end user segments across the country.