India HPCL postpones refineries start on Covid

Indian state-run refiner Hindustan Petroleum (HPCL) will delay commissioning of expansion programmes at its 150,000 b/d Mumbai refinery on the west coast and the 166,000 b/d Visakhapatnam facility on the east coast by several months because of the Covid-19 pandemic.

The 40,000 b/d expansion of the Mumbai refinery to 190,000 b/d will be completed in calendar year 2021 as will the 134,000 b/d expansion of the Vizag refinery, HPCL chief executive Mukesh Surana said. A product upgrade project at Vizag will be ready by 2022.

HPCL has also started construction work at a 180,000 b/d inland refinery at Barmer, Rajasthan, and will complete the project in 2023, Surana said. The refiner is expanding Vizag's capacity to 300,000 b/d by adding a 180,000 b/d CDU. Mumbai expansion was scheduled to be ready by January 2020 and Vizag by July.

The projects have been delayed by the five-month lockdown from 25 March to combat the pandemic. India's federal lockdown is due to end on 31 August, over five months after starting. Cases of coronavirus are increasing by over 50,000 every day and are now nearing two million, with fatalities over 40,600.

Demand for diesel and gasoline were only 89pc and 83pc of year-earlier July demand, respectively, Surana said. Refineries will first exhaust product stocks before sending runs higher, he said, and will calibrate throughput to demand and inventories.