50% Cost Reduction Eyed: BPCL, HPCL, IOC Plan To Share Pipeline Infra To Reduce Cost



Public sector oil companies — HPCL, BPCL and IOC — are planning to share the investments for upcoming product and gas pipelines across the country that will help them reduce the capital expenditure on pipelines and enter newer markets at less than 50% of the original project cost.

The companies have already identified around 5-6 major pipeline projects where they plan to share the infrastructure, senior company officials said. The three oil companies have prepared a white paper after an industry-wide consultation which allows them to go ahead with sharing of infrastructure wherever it makes a commercial sense. “The companies have identified projects such as Kandla-Gorakhpur LPG pipeline, Gas Grid for seven north-eastern states, Kochi-Salem LPG pipeline, and Uran-Chakan gas pipeline for sharing of infrastructure depending on their needs” R Ramachandran, director – refineries of BPCL.

Besides, there will be multiple opportunities that will come from the 60 MTPA West Coast Refinery coming up in Maharashtra, he added.

“Under the model, the promoter of the project proposes and the interested parties become an investing partner. There can be common user facilities such as terminals and depots that can be shared by all the three parties as well. However, the operations and maintenance will depend on the main company which has the refinery in the region,” Ramchandran said.


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