A Pre-Submission report on

Study of Refinery Capacity utilization with special

reference to Indian Oil Corporation and Bharat
Petroleum corporation

UNDER SUPERVISION OF SUBMITTED BY

Dr. (Mrs.) SHAIVYA SINGH PUSHPESH KUMAR
Sr. Lecturer, SMS PGRM/02/35, SMS

School of Management Sciences, Varanasi

2008-09

INTRODUCTION
1. CAPACITY UTILISATION

MANY domestic oil companies have the potential to go global while integrating
their operations within the entire hydrocarbon value chain.

In the `XIII refinery technology meet on maximising hydrocarbon value chain',

However, refineries face the challenge of competing in the changing world energy
scene, while being cost effective. Citing a study conducted in partnership with
Shell, only two refineries in the country met the better plant capacity utilisation
benchmarks. This has to be extended to other plants.

The three-day refinery technology meet is aimed at addressing issues relating to

country's energy security and sustaining refining business in the context of rising
crude oil prices, etc. Three grassroots refineries of BPCL at Bhatinda (Rs 10,000
crore investment), BPCL, Oman Oil at Bina in M.P. (Rs 9,000 crore) and IOC's at
Paradip (Rs 18,000-20,000 crore), were coming up. 75 per cent of the crude oil
requirement is met through imports, and the country is heavily vulnerable on
various external factors affecting the hydrocarbon sector. Demand for energy in
India is expected to double the world average growth of 1.9 per cent.

2.REFINERIES IN INDIA

1. As of July, 2008 there are a total of 18 refineries in the country comprising 17

in the Public Sector, one in the private sector. The company-wise locations and
capacity of the refineries as on 1.01.2008 as given below:
S.No Name of the company Location of the Capacity (MMTPA)*
Refinery
1. Indian Oil Corporation Limited (IOCL) Guwahati 1.00

2. IOCL Barauni 6.00

3. IOCL Koyali 13.70

4. IOCL Haldia 6.00

5. IOCL Mathura 8.00

6. IOCL Digboi 0.65

7. IOCL Panipat 6.00

8. Bharat Petroleum Corporation Limited (BPCL) Mumbai 6.90

9. Kochi Refineries Ltd. (KRL) Kochi 7.50

10. Bongaigaon Refinery & Petrochemicals Ltd. (BRPL) Bongaigaon 2.35

11. Numaligarh Refinery Ltd.(NRL) Numaligarh 3.00

12. Mangalore Refinery & Petrochemicals Ltd. (MRPL) Mangalore 9.69

TOTAL 70.79
• Mil*m*Million Metric Tonnes Per Annum

2.1 REFINING CAPACITY AND CAPACITY UTILISATION

1. To meet the growing demand of petroleum products, the refining

capacity in the country has been gradually increased over the years by
setting up of new refineries in the country as well as by expanding the
refining capacity of the existing refineries. The total refining capacity in
the country as on 1.7.2005 stands at 127.37 MMTPA.

2. The refining capacity, actual crude throughput and capacity utilisation

during the last five years are indicated below:

2000-01 2001-02 2002-03 2003-04 2004-05

Refining
Capacity(As on
114.59 114.66 116.96 127.37 127.37
1st April)

Actual Crude
throughput 103.1 106.5 10.6 118.7 124.3
(MMTPA)

Capacity
91.00 93.00 95.00 99.00 ---
Utilisation (%)

2.3 INTRODUCTION OF IOC REFINARY

 Indian Oil Corporation Limited

Type PSU (Trading on BSE & NSE)

Founded 1964

Headquart
New Delhi, India
ers

Key people Sarthak Behuria, Chairman

Petroleum products = Petrol,

Industry Diesel, Kerosene, LPG,
Petrochemicals

▲ र. 2474.79 billion or $61.7

Revenue
Billion [1] (2007-2008)

Net US$ 1.96 billion (2007) ▲

income 12.9% from 2006

Indian Oil is currently metamorphosing from a pure sect oral company with
dominance in downstream in India to a vertically integrated, transnational energy
behemoth. The Corporation is already on the way to becoming a major player in
petrochemicals by integrating its core refining business with petrochemical
activities, besides making large investments in E&P and import/marketing
ventures for oil & gas in India and abroad.
2.3.1 IOC REFINARIES

Digboi Refinery, in Upper Assam, is India's oldest refinery and was

commissioned in 1901. Originally a part of Assam Oil Company, it became part
of IndianOil in 1981. Its original refining capacity had been 0.5 MMTPA since
1901. Modernization project of this refinery has been completed and the refinery
now has an increased capacity of 0.65 MMTPA.
Guwahati Refinery, the first public sector refinery of the country, was built with
Romanian collaboration and was inaugurated by Late Pt. Jawaharlal Nehru, the
first Prime Minister of India, on 1 January 1962.

Barauni Refinery, in Bihar, was built in collaboration with Russia and Romania.
It was commissioned in 1964 with a capacity of 1 MMTPA. Its capacity today is 6
MMTPA.

Gujarat Refinery, at Koyali in Gujarat in Western India, is IndianOil’s largest

refinery. The refinery was commissioned in 1965. It also houses the first
hydrocracking unit of the country. Its present capacity is 13.70 MMTPA.

Haldia Refinery is the only coastal refinery of the Corporation, situated 136 km
downstream of Kolkata in the Purba Medinipur (East Midnapore) district. It was
commissioned in 1975 with a capacity of 2.5 MMTPA, which has since been
increased to 5.8 MMTPA

Mathura Refinery was commissioned in 1982 as the sixth refinery in the fold of
IndianOil and with an original capacity of 6.0 MMTPA. Located strategically
between the historic cities of Delhi and Agra, the capacity of Mathura refinery
was increased to 7.5 MMTPA.

Panipat Refinery is the seventh refinery of IndianOil. The original refinery with
6 MMTPA capacity was built and commissioned in 1998. Panipat Refinery has
doubled its refining capacity from 6 MMT/yr to 12 MMTPA with the
commissioning of its Expansion Project.

2.4 INTRODUCTION OF BPC REFINERY

 Bharat Petroleum Corporation Limited

Type PSU (Trading on BSE)

1976 (After nationalisation of
Founded
Burmah Shell Company)
Headquarter
Mumbai, India
s
Key people Ashok Sinha, Chairman & MD
Industry Petroleum
Products Oil , LPG
USD $27.873 Billion (2007-
Revenue 2008) ▲ 27.5% from (2006-
2007)
Website www.bharatpetroleum.com

Bharat Petroleum Corporation Limited (BPCL) is one of India's largest PSU

companies, with Global Fortune 500 rank of 287 (2008). Its corporate office is
located at Ballard Estate, Mumbai. As the name suggests, its interests are in
petroleum sector. It is involved in the refining and retailing of petroleum
products.Bharat Petroleum is considered to be a pioneer in Indian petroleum
industry with various path-breaking initiatives such as Pure for Sure campaign,
Petro card, Fleet card etc.

2.4.1 BPC REFINARIES

BPCL has Refineries at Mumbai and Kochi(Kochi Refineries) with a capacity of

12 Million Metric Tonnes (MMT) and 7.5 MMTPA respectively for refining
crude oil. BPCL's subsidiary at Numaligarh has a capacity of 3 MMT.

FINDINGS -
TABLE 1.

CURRENT PRODUCTION CAPACITY OF

REFINARIES

TABLE 2.
INSTALLED CAPACITY AND REFINERY CRUDE THROUGHPUT
 TABLE 3.

CAPACITY UTILISATION BY INDIAN OIL CORPORATION

Cumulativ
Annual e Monthly Quarterl
Indicator Units Expression L L L L
Refinery Capacity Utilisation By Per
Indian Oil cent Ival 105.99
Refinery Capacity Utilisation By Per
Indian Oil cent Ival 100.09
Refinery Capacity Utilisation By Per
Indian Oil cent Ival 106.25
Refinery Capacity Utilisation By Per
Indian Oil cent Ival 106.33
Refinery Capacity Utilisation By
Indian Oil % YoY 7.79
Refinery Capacity Utilisation By
Indian Oil % YoY 7.71
Refinery Capacity Utilisation By
Indian Oil % YoY 4.14
Refinery Capacity Utilisation By
Indian Oil % YoY 20.13
Refinery Capacity Utilisation By
Indian Oil % PoP 2.05
Refinery Capacity Utilisation By
Indian Oil % PoP -1.97
Refinery Capacity Utilisation By
Indian Oil % PoP -0.05
Refinery Capacity Utilisation By
Indian Oil % PoP 7.71
 TABLE 4

CAPACITY UTILISATION BY BHARAT PETROLEUM CORPORATION

Cumulativ
Annual e Monthly Q
Indicator Units Expression L L L L
Refinery Capacity Utilization By Bharat Per
Petroleum cent Ival 108.51
Refinery Capacity Utilization By Bharat Per
Petroleum cent Ival 107.08
Refinery Capacity Utilization By Bharat Per
Petroleum cent Ival 104.45
Refinery Capacity Utilization By Bharat Per
Petroleum cent Ival
Refinery Capacity Utilization By Bharat
Petroleum % YoY -2.86
Refinery Capacity Utilization By Bharat
Petroleum % YoY -7.94
Refinery Capacity Utilization By Bharat
Petroleum % YoY
Refinery Capacity Utilization By Bharat
Petroleum % YoY -3.63
Refinery Capacity Utilization By Bharat
Petroleum % PoP
Refinery Capacity Utilization By Bharat
Petroleum % PoP 3.11
Refinery Capacity Utilization By Bharat
Petroleum % PoP 1.34
Refinery Capacity Utilization By Bharat
Petroleum % PoP -7.94
ANALYSIS -

COMPARATIVE BAR GRAPHS:-

GRAPH 1.

IOC AND BPC PRODUCTION

PRODUCTION OF IOC & BPC

4500
4000
3500
3000
MMTPA

2500 IOC
2000 BPC
1500
1000
500
0
2004-05 2005-06 2006-07
YEARS

PRODUCTION OF REFINERY

MMTPA 2004-05 2005-06 2006-07

IOC 3142 3464 4072

BPC 1881 3402 3992

*MMTPA=20000 barrels per day

GRAPH 2.
 IOC & BPC TOTAL INCOME:-

Income of IOC & BPC

300000
250000
Rs (in crores)

-
200000
Total income of IOC
150000
-
100000
Total income of BPC
50000
0
12 mths 12 mths 12 mths 12 mths 12 mths 12 mths

Mar Mar Mar Mar Mar Mar

2002 2003 2004 2005 2006 2007
Years

INCOME OF IOC & BPC

Mar Mar Mar Mar Mar

Rs (in crores) Mar 2002 2003 2004 2005 2006 2007
12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
-
Total income of IOC 116304.9 125990.68 137586.33 158139.42 201908.8 256164.55
-
Total income of BPC 42557.03 49049.93 54575.53 65607.19 85668.04 108226.27

GRA
 GRAPH 3.
TOTAL EXPENSES OF IOC & BPC

TOTAL EXPENSES OF IOC & BPC

300000
250000
Rs (in crores)

-
200000
Total expenses of IOC
150000
-
100000
Total expenses of BPC
50000
0
12 12 12 12 12 12
mths mths mths mths mths mths

Mar Mar Mar Mar Mar Mar

2002 2003 2004 2005 2006 2007
YEARS

TOTAL EXPENSES OF IOC & BPC

Mar Mar Mar Mar Mar
Rs (in crores ) Mar 2002 2003 2004 2005 2006 2007
12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
-
Total expenses of
IOC 113059.1 122288.01 131310.98 154902.69 199593.77 248485.26
-
Total expenses of
BPC 41370.21 49266.57 52596.94 66227.64 86130.83 106626.33

GR
GRAPH 4.
IOC & BPC NET SALES IN FIGURES

TOTAL SALES OF IOC & BPC

300000
250000
Rs (in crores)

-
200000
Total sales of IOC
150000
-
100000
Total sales of BPC
50000
0
12 12 12 12 12 12
mths mths mths mths mths mths

Mar Mar Mar Mar Mar Mar

2002 2003 2004 2005 2006 2007
YEARS

TOTAL SALES OF IOC & BPC

Mar Mar Mar Mar Mar Mar
Rs (in crore ) 2002 2003 2004 2005 2006 2007
12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
-
Total sales of IOC 115182.42 124378.83 135908.93 156768.6 199430.91 250380.17
-
Total sales of BPC 42274.04 48578.49 54084.41 63857.01 85149.62 107452.27
CONCLUSION:-

• Performance of Oil production: -

On the basis of data
acquired we can conclude that both IOC and BPC have
contributed up to 63% of total Oil production of Indian OIL
Refining industry. Individually IOC has contributed 44.20% &
BPC has contributed 18.80% of the total oil production of
Indian oil Refining industry.

• Performance of net sale: -

Looking towards the net sale of
both IOC and BPCL we can conclude that IOC is showing
better performance in respect to the BPCL performance.

Performance of total income: -

Now looking towards the total income of
both IOC and BPC we can conclude that IOC yearly gained
income is greater than the BPC gained income.
• Performance of total expenses: -
Looking towards the
performance of IOC of total expenses we can say that total
expenses incurred by the company were rising heavily from
March 2003 to march 2007. Now looking next to that of BPC
we can say that from March 2002 to Mar2007 it is showing a
consistent growth in there expenses.

Bibliography:-
• CMIE DATA BASE (PROWESS)
• www.petroleum.nic.in
• www.indianoil.com(IOC Annual Report)
• www.bharatpetroleum.com(BPC Annual Report)