Production from Mozambique not before FY21, says BPCL

State-owned Bharat Petroleum Corporation (BPCL) has said that natural gas flow from the Rovuma Basin in Mozambique will be delayed by a couple of years.

 “We hope gas production to begin from 2020-21 and not 2018-19 as originally expected due to the delays. The operator is in final stages of signing fuel contractrual agreements.

The company hopes to take a final decision on the investment early next year,” BPCL chairman and managing director S Varadarajan said.

The capital expenditure for Mozambique has come down and will be reworked, Varadarajan said, adding that 65-70% of capex for the project will be funded through debt.

According to Varadarajan, the company is in final stages to acquire upstream assets in Russia. “We are seeking final approvals with our consortium partners in Russia. The government is in final stages of granting its nod for the acquisition and we hope to conclude the acquisition in the next couple of months,” Varadarajan said.

 We have the option to raise funds from international borrowings and will be seeking loans to fund the acquisitions, Varadarajan added.
 
As far as capital expenditure is concerned, Varadarajan said that the company is planning capex of Rs 1 lakh crore in the next five years. “Out of the Rs 1 lakh crore, Rs 50-55,000 crore will be spent on refineries while the rest will be split between marketing, upstream, small joint ventures and marketing infrastructure”, Varadarajan said.
 
The planned West Coast refinery will have a total investment of Rs 1.5-1.8 lakh crore and the consortium of public sector oil marketing companies have sought 15,000 acres of land for the project in Maharashtra, Varadarajan added.