India is likely to start the operations of 85 crude oil refinery projects, accounting for about 52% of the upcoming crude oil refinery projects in Asia from 2021 to 2025, according to GlobalData.
This many crude oil refineries that are to come online between these periods is as a result of the rising consumption of oil and economic growth.
GlobalData’s latest report, ‘Global Crude Oil Refinery Projects Outlook, 2021-2025’, reveals that out of the 85 projects, two projects are new build and 83 represent expansions of existing projects.
Based on GlobalData’s checks, 44 upcoming refinery projects are in the approval stage and likely to start operations between 2021 and 2025. Construction and feasibility are the other major project stages with 22 and 19 projects, respectively.
Bhargavi Gandham, Oil and Gas Analyst at GlobalData, commented:
“India, being one of the leading consumers of petroleum products in the world, continues to add substantial refining capacity to meet the ever-growing demand. In July 2021, India approved 100 per cent foreign direct investment in government-owned refineries to facilitate the privatization of Bharat Petroleum Corporation, one of the leading refiners in the country.”Bhargavi Gandham, Oil&Gas Analyst, GlobalData
The two new build projects that are expected to start operations by 2025 are Barmer and Nagapattinam II, each with a capacity of 180 thousand barrels per day (mbd). Among crude distillation unit (CDU) expansion projects, Vadinar CDU expansion is one of the key projects with a refinery capacity of 515 barrels per day (mbd) costing of US$1,010 million.
India and China to lead oil refinery in Asia
The project is expected to start operations in 2024. Nayara Energy Ltd. is the operator while Rosneft Oil Company and Trafigura Group Pte hold major stakes with 49.1 per cent and 24.1 per cent of equity, respectively.
The Panipat CDU expansion project stands second with a refinery capacity of 200 mbd and costing US$346 million. Indian Oil Corp Ltd. is the operator as well as 100 per cent equity holder of this project, expected to start operations in 2024.
China, on the other hand is likely to start the operations of 42 crude oil refinery projects or 26 per cent of the total crude oil refinery projects in Asia between 2021 and 2025. This is aimed at meeting the growing demand for plastics and petroleum products.
In China, 22 upcoming refinery projects are in the construction stage and likely to start operations between 2021 and 2025. Feasibility and approval are the other major project stages with twelve and six projects, respectively.
Bhargavi Gandham, further stated that: “China, the world’s largest oil and gas importer, and a leading consumer, continues to witness strong growth in the refinery sector. Growing demand, especially from petrochemicals and transportation sectors, will boost the refining activity in the country.”
According to GlobalData, during 2021-2025, Yulong and Jieyang are expected to be the leading projects in terms of refining capacity in the country. These have 400 thousand barrels per day of capacity, each.
Shandong Yulong Petrochemical Ltd. is the operator as well as 100 per cent equity holder of the Yulong project, which is expected to start operations in 2023.