State owned Bharat Petroleum Corporation’s Bina refinery plans to come out with an initial public offering during the Q2 of this fiscal to rise about INR 2,500 crore to increase its capacity to 9 million tonnes.

Mr UN Joshi MD of Bharat Oman Refineries said “We are ready for the IPO. It all depends on market condition.”

Bharat Oman Refineries is setting up the project at a cost of INR 11,397 crore is a joint venture between BPCL and Oman Oil Company.

The company plans an offering of about 25% equity shares. After the float BPCL will hold 49% in Bharat Oman Refineries while Oman Oil Company will own 26%.

Bharat Oman Refineries had filed a draft red herring prospectus with the Securities and Exchange Board of India in 2008 but deferred its plan because of a weak stock market.

Mr RK Singh chairman and MD of BPCL said Bina refinery has a capacity of 6 million tonnes per year or 120,000 barrels per day was commissioned in January and will be formally inaugurated by Prime Minister Mr Manmohan Singh on May 20.

The refinery in Madhya Pradesh will meet the growing fuel demand of the country.

Mr Singh said “We are looking at expanding the capacity to 9 million tonnes in the first phase in what is called creeping expansion.” The capacity of existing equipment will be raised a process that may take up to three years and cost about INR 2,000 crore.

Sources said Bharat Oman Refineries planned to expand the capacity of the refinery to 15 million tonnes by 2016 to 2017. The refinery will initially process crude oil imported from Saudi Arabia.

Mr Joshi said that “It is designed to process Saudi crude and we have tied up 2.5million tones to 3 million tonnes of crude from Saudi Arabia.”

The firm has laid a 935 km pipeline from Vadinar on the Gujarat coast to Bina for transporting crude.

Nearly half of the refinery’s output will be diesel; it will also produce 0.6 million tonnes each of petrol and jet fuel.

(Sourced from www.telegraphindia.com)