BPCL rose up to the challenges and served the energy needs of the nation uninterrupted-CMD-BPCL

Mumbai : BPCL New CMD Mr Arun Kumar  chaired-up his first AGM in Mumbai, Welcome address on his first AGM, He said  It is my pleasure to speak to you after taking over charge of Chairman and Managing Director of BPCL. We have been witnessing difficult times over a year now. BPCL rose up to the challenges and served the energy needs of the nation uninterrupted. We contributed immensely to wellbeing of society and nation’s fight against COVID including contribution to PM CARES Fund, setting up of ICUs for COVID patients, providing PPE kits to health workers, distribution of sanitizers and face masks, feeding the needy, extending Mediclaim insurance, free-of-cost supply of oxygen from refineries as well as provision of PSA oxygen plants to hospitals.

• Like every other sector, O&G sector too, has been adversely impacted due to the COVID situation. We witnessed loss of demand, production cuts, and huge volatility in crude oil prices and product cracks. Situation has improved but uncertainty prevails.
• I am sure, you are already aware of BPCL’s performance in 2020-21. Let me share with you some significant highlights-
• Recorded the highest ever Profit Before Tax of ₹ 22,618 crore and Profit After Tax of ₹ 19,042 crore on a standalone basis, even after excluding the one-time gain on the sale of stake in Numaligarh Refinery Limited and other Exceptional Items, the Profit Before Tax was still the highest ever at ₹ 16,169 crore. Strong refining and marketing margins, coupled with adroit management of inventories, have contributed to this stupendous performance.
• On the physical front, the pandemic related demand disruptions resulted in a decline in refinery throughput to 26.40 MMT and market sales to 38.74 MMT, i.e. lower by 17% and 10% respectively, as compared to last year, which was in line with the industry. BPCL commissioned 2,444 ROs in 2020-21, highest in BPCL history –now we have second largest RO network – 19,076 ROs as on 1^st Sep 2021. Further consolidating its grip over Petrol and Diesel retailing, BPCL has enhanced its market share among PSU OMCs which is now hovering around 30%.
• Declared highest ever dividend of ₹ 79 per share, which includes a one-time special dividend of ₹ 35 per share.
• BORL is a 100% subsidiary now, we have also purchased Govt. of MP warrants. BORL will eventually be merged with the Company, thereby allowing significant logistics and operational synergies leading to overall value enhancement.
• Bharat Gas Resources Limited (BGRL) being merged with BPCL, for similar reasons, and has taken necessary steps towards the same.
• With refineries strategically located to cater to all four geographical regions of the country and having flexibility to swing between products mainly petrol and diesel, your Company is well positioned to serve the growing fuel demands of the nation in the short to medium term including expected high growth in petrol.
• Energy landscape is changing fast and Energy Transition towards a low-carbon future has accelerated. BPCL is actively exploring new business opportunities for sustained growth. BPCL will not only be able to mitigate the risks in the oil and gas space, comfortably but also establish profitable and sustainable new business lines.
• Our Temple of Aspirations is propped on 5 pillars with a solid foundation provided by our core business of refining and marketing of petroleum products. Our glorious future is predicated on an increased contribution from these initiatives, and while they prime up, these would be bolstered by the core business-

1) Petchem, 2) Gas, 3) Electric Mobility, 4) Consumer Retailing, and 5) Renewables & Bio Fuels.

• Petrochemicals
• With the commissioning of 2 units in Propylene Derivative Petrochemical Project (PDPP) at Kochi Refinery in February 2021, we have joined the leaders in production of niche petrochemicals
• Will increase our presence in petrochemical space, integrating with our refining activity to diversify & hedge, it provides flexibility.
• We are presently evaluating various propylene and ethylene derivatives, both in the bulk as well as niche segments.
• Natural Gas
• India targets to increase share of natural gas in overall energy consumption from 6.2% to 15% (by 2030).
• BPCL present across Gas value chain from regasification through our JV PLL to CGD through our Gas SBU, BGRL and JVs. The company is progressing well with its CGD business and projects in 37 GAs. Including our JVs, so far we have set up 1,393 Fuel Stations (664 of BPCL’s own) and have planned 12 LNG stations.
• Our presence in CNG stations is going to grow manifold in the next few years,
• We’ve also have notable presence in LNG business and have extensive plans to scale up this business and set up requisite infrastructure and filling stations.
• Electric Vehicle Charging Network
• BPCL is closely watching EV development in India – higher penetration expected in 2 and 3 Wheelers. EV space – new business opportunity as well as a hedge against the risk of displacement of auto fuels.
• EV charging station at BPCL fuel station: EV Charging facilities installed in 44 Retail Outlets in the major cities, and work is in progress at another 54 ROs.
• Battery Swapping at BPCL fuel station: Pilot of battery swapping for 3 wheelers in Kochi and Lucknow in alliance with IIT Madras and Kinetic Green. Started in February’ 2020, showed immediate success, but suspended due to pandemic. Being restarted.
• We are in process of converting around 7,000 conventional Retail Outlets into Energy Stations in medium to long term, providing multiple fueling options like petrol, diesel, flexi fuels, EV charging facility, CNG and eventually hydrogen.
• Consumer Retailing
• BPCL is present in retail space through its In & Out and Beyond LPG initiatives. With Indian retail market poised for exponential growth, BPCL is fully geared up to enhance its foot prints and emerge as a formidable player leveraging its assets, nationwide network of 19,000+ Fuel Stations and 6,200+ LPG Distributors and relationships, that offers consumables, durables, and services
• Created a ‘New Businesses’ SBU for focused activities.
• Renewables & Bio Fuels
• We are looking to further expand in this space as growth and diversification strategy , both in solar and wind, as a power producer which would benefit the company in various ways i.e. diversification, offsetting GHG emissions arising from fossil fuel portfolio. Renewable power can also help in enabling EVs and production of green hydrogen.
• Biofuels: BPCL is setting up a 2G Bio-ethanol Refinery at Bargarh, Odisha with a production capacity of 100 KL per day. BPCL is also exploring the possibility to set up four 1G Ethanol plants in deficit states with a capacity of 100KL/D
• Actively participating EBP program – 20% by 2025
• Digital Transformation
• Embarked upon a comprehensive digitalization journey through “Project Anubhav”.Will serve to enhance efficiencies business process efficiencies, improve supply-chain transparency, draw market intelligence, bolster BPCL’s marketing skills, provide unified view of customer to BPCL and vice-versa. Initiatives include-
  • HelloBPCL, a unified and integrated app for one stop solution, which will give single window view of BPCL to our customers
  • Urja, our Artificial Intelligence (AI) based Chatbot available on WhatsApp and BPCL Website and proficient in 13 languages
  • IRIS, the Digital Nerve Centre increasing transparency in our supply chain and helping us deliver our brand promises
  • SalesBuddy, the Customer Relationship Management solution to build and nurture customer relationships
• Customer centricity has been at the fulcrum of all our activities and central to all our endeavors.
• Talking about BPRL, security incidents during March-end 2021 in Mozambique has led the Operator to withdraw all project personnel from the site and declare force majeure for the project. Now, progress is being made in improving the security situation in the region and the project will resume once the security situation is stabilized in a sustainable manner.
• With imminent disinvestment, BPCL is at the threshold of a major transformation in its ownership structure, which is expected to unlock tremendous value through sharpening of professionalism, improvement in efficiencies, increased investments, access to advanced technologies and newer global markets, and product diversification. Amidst this impending momentous shift, the Company is progressing ceaselessly, while continuing to maintain its growth plans and value creation strategies in a seamless manner.
• BPCL is closely monitoring the evolving situation, recalibrating its responses and taking all necessary actions and initiatives to ensure safe and smooth operations, improve upon efficiencies, build on capabilities and create new capacities, leveraging technology.

BPCL shall continue on its journey of growth, delivering excellent performance and creating immense value for all the stakeholders.