How is this oil and gas producer, Bharat Petroleum, driving the Indian economy?
Since it depends on resources from the earth to produce money, the oil and gas business is the most important one on the global scale. The oil and gas industry is one of India’s six prior industries. The development of India’s economy depends on them. It has the fastest overall growth rate, has a variety of investment alternatives, and has a lot of promise.
Oil was found in Digboi, in Assam, in 1889, which is when this industry first began. The oil and gas industries began to expand in the 1960s.
Read this article to learn more about Bharat Petroleum, one of India’s top oil and gas companies, including its founders, business model, revenue model, shareholders, rivals, issues faced, and more.
What Is Bharat Petroleum and How Does It Operate?
Oil and gas are produced by the 1976-founded, government-owned Bharat Petroleum Corporation Limited (BPCL). It has three production facilities, located in Mumbai, Kochi, and Bina.
Exploration and gas and oil production are the main focuses of Bharat Petroleum. According to sources, Bharat Petroleum Corporation Ltd. oversees the bulk of the petroleum industry in India (BPCL).
BPCL is governed by the Ministry of Petroleum and Natural Gas. Additionally, the business is India’s second-largest government-owned downstream oil corporation. The company only operates in one sector, Refining and Marketing Activities, which includes the Downstream petroleum business. They also confront the exploration and production of hydrocarbons (E&P).
Oil is produced by Bharat Petroleum for use in automobiles, fleets, aircraft, and other businesses and industries. In addition, the business participates in multiple CSR initiatives.
Indian Oil Corporation – Industry
After China and the USA, India is the third-largest consumer of energy and oil globally. India wants to cut its reliance on oil and gas imports by 10% by 2022, taking advantage of the industry’s tremendous growth potential.
It is a Fortune Global 500 corporation that refines crude oil and sells petroleum products and is one of India’s top integrated energy companies. Both upstream and downstream of the oil and gas industry are greatly affected by it. BPCL holds the honourable Maharatna title.
The Chairman and Managing Director of Bharat Petroleum Corporation Limited are now Shri Arun Kumar Singh.
Arun Kumar Singh
Graduate of the National Institute of Technology, Patna, Arun is a mechanical engineer. Arun Kumar Singh was named Chairman and Managing Director of BPCL in 2021. Arun has worked in the oil and gas sector for more than 36 years. Arun has led many Business Units and Entities at BPCL throughout these years, including Retail, LPG, Pipelines, Supply Chain Optimization, etc.
In addition, he held the position of President (Africa & Australia) at Bharat PetroResources Ltd., a fully-owned subsidiary of BPCL that primarily engaged in international oil and gas exploration. He holds the positions of director on the board of Bharat Gas Resources Ltd. and chairman of Indraprastha Gas Ltd.
Bharat Petroleum: The Growth of a Startup
The Burmah Shell Oil Storage & Distribution Company was established in India in 1928 when the country was still ruled by the British.
The British began importing petroleum products into India, and the company expanded. Burmah Shell Oil Storage & Distribution Burmah Shell refineries established a refinery in Mumbai after getting the top spot in India, which resulted in the formation of Burmahshell Refineries Limited (BSR). The refinery company launched LGP as a cooking fuel for Indian homes as part of this venture.
The first pump station was introduced by Burmah Shell (now Bharat Petroleum) in 1928. The client was able to see just how much fuel he was purchasing thanks to the addition of a big glass cylinder that was linked to the pump and was retrofitted to existing pumps. The visible cylinder was later replaced by the clock-style metre, which became commonplace on gas pumps in the early 1930s.
The business has lubricants that met the highest requirements for quality, had staff members who had undergone specialised training, and had a cutting-edge quality control lab. At Wadi-Bandar, the lubricant was the largest and most developed in the Eastern region.
Currently, Wadilube provides the full range of lubricants and combines 349 different lubricant grades into 841 SKUs.
In 1976, the business was renamed Bharat Refineries Limited (BRL). At that point, the Indian government took control of the corporation. The business was renamed Bharat Petroleum Corporation Limited thereafter, after a year.
In 1999, Bharat Petroleum launched the PetroBonus Program. It is the first pre-payment-cum-rewards programme for the oil business in the country and it makes use of cutting-edge, user-friendly smart cards with microprocessors.
As the country’s first modern refinery today, the corporation represents the country’s industrial strength and makes use of cutting-edge technology advancements to facilitate digital transformation.
Mission & Vision of Bharat Petroleum
The company’s seven key values are as follows:
- Trust
- Focus on the client
- The Growth of People
- Ethics
- Innovation
- Collaboration
- Involvement
Offering services that ethically benefit society and the environment is the company’s goal. It aspires to develop into a fantastic organisation on a professional and a personal level.
By converting the current crises into unusual qualities that will aid in the building of a better country, the company hopes to establish sustainable development and be the change.
Name, logo, and tagline for Bharat Petroleum
After the Indian government acquired Burmahshell Refineries Limited (BSR) in 1978, Bharat Petroleum was formerly known as Bharat Refineries Limited (BRL).
The company’s logo is made up of a bold white design surrounding a solid blue circle with a yellow “Yin and Yang” inside it (representing the sun and shadow). The white line added lightness and balance to the strong, powerful emblem while maintaining its firmness and stability.
The slogan of Bharat Petroleum is “energising lives.”
Business Model of Bharat Petroleum
The corporation is publicly traded and owned by the Indian government. On September 29, 2000, the company’s IPO went live.
Its operations mostly entail the following services:
Services and Fuel
A variety of premium fuel options, speed and Speed 97, which ensure a great driving experience for enthusiasts, in addition to gasoline, diesel, vehicle LPG, and compressed natural gas. In addition, the company offers impressive and cutting-edge services to meet the rising expectations of the modern world.
This applies to particular fuel station formats such as Ghar, Highway Star, Pure for Sure, Smart Fleet, Petro Card, Smart Drive, Door-to-Door Fuel Kart, BPCL SBI Card, and other services of the same nature that ensure a flawless client experience.
The MAK Lubricants
This will distribute lubricants and greases to markets in India and abroad. To meet the various and continuously shifting needs of the industrial sector and the automotive market, they provide a wide range of 400+ grades across multiple categories.
Flight Services
The aviation fuel sector is under the management of Bharat Petroleum. Every stage of the value chain is affected, including the production of jet fuel at refineries, its transportation and storage, Intoplane services, the operation of fuel-operating systems that meet international quality requirements, and other value-added services.
Commercial and Industrial Activity
Accordingly, the company operates under a B2B business model with industrial and commercial oil and serves a broad range of industrial sectors, including cement, heavy industry, power, railways, paints, petrochemicals, and others.
Oil Refineries
The following refineries are run by it:
The Bina Refinery is a facility in Madhya Pradesh’s Sagar district. Every year, the factory generates 7.8 million metric tonnes. Bharat Oman Refineries Limited is a joint venture between Bharat Petroleum and Oman Oil Company (BORL).
The Kochi Refinery, which is in Kochi, Kerela, has a yearly production capacity of 15.5 million metric tonnes. 13 million tonnes can be produced annually at the Mumbai Refinery.
Trade internationally
Additionally, Bharat Petroleum does commerce by carrying out the duties of the International Trade Department, such as:
- Crude Oil Import and Local Purchasing.
- Coastal movements and the chartering of crude and petroleum products.
- Risk Control.
- Operations connected to the import/export of petroleum products.
- Competency Evaluation
To meet the needs of laboratories in the petroleum sector in India and surrounding areas, the brand is now conducting Proficiency Test (PT) programmes for the first time in the petroleum industry. The testing facility is located in Mumbai and has been granted successful accreditation by the NABL (National Accreditation Board for Testing and Calibration Laboratories). This separate organisation is under the Department of Science and Technology.
SAP Training
Additionally, Bharat Petroleum delivers SAP training. One of the top software programmes is SAP, which is now a pretty difficult course. Today, almost all sectors need SAP solutions. A programme like the Bharat Petroleum SAP Training Center aims to train aspiring SAP consultants in person.
Revenue Model for Bharat Petroleum
The company’s subsidiaries, including Bharat PetroResources Ltd. (BPRL), Bharat Oman Refineries Limited (BORL), Bharat Gas Resources Limited (BGRL), Bharat Renewable Energy Limited (BREL), and others, are responsible for the company’s revenue generation.
In comparison to $38 billion (3,04,274 crores) in the year 2020–2020, the corporation reported sales of $54.2 billion (432,569 crores) in the year 21–22.
During the same period, a consolidated net profit of $1.4 billion (11,681 crores) was reported.
Shares of Bharat Petroleum
52.98% of the shares in Bharat Petroleum are owned by the Promoter & Promoter Group (Government of India). Mutual funds, foreign portfolio investors, financial institutions/banks, and insurance companies all have a 46.71% stake in the company. Shares held by Employee Trusts are at 0.32%, and Non-Promoter Non-Public is at 0.32%.
Bharat Petroleum’s rivals
Bharat Petroleum in India faces fierce competition from other oil and gas sectors. These are a few of the biggest rivals:
- Reliance Industries
- Oil and Natural Gas Corporation (ONGC)
- Indian Oil Corporation Ltd. (IOCL)
- Hindustan Petroleum Corporation Ltd. (HPCL)
- Mangalore Refinery and Petrochemicals Limited (MRPL)
- Oil India
- Jindal Drilling
- Asian Energy
- Selan Expl. Tech
- Aban Offshore
- Duke Offshore
Bharat Petroleum: Honors and Success
The major prizes given out in the petroleum sector have always gone to BPCL. The list of honours and distinctions that the business has received over the past few years is as follows:
2022
- BPCL has been named the industry’s top performance in the Oil – Refining & Marketing category by Dun & Bradstreet.
- “Business Performance in Ship/Cargo Handling at Cochin Port” is the section for 2021.
- 2022’s Global Safety Summit will present the National Health, Safety, Security, and Environment Award.
- Joint Secretary Refinery Award for Best Energy Efficient Project Implementation.
- PCRA presents the Best Energy Efficiency Award for FY 2021 to the Sultanpur LPG Bottling Plant of BPCL.
- A five-year MOU for #GreenInitiatives is signed by BPCL and the government of Odisha.
- The first Water Sustainability Awards will be held in 2021–2022.
- Award for leadership and excellence in global CSR.
2021
- At the World Sustainability Congress, a certificate of excellence in sustainable EHS was awarded.
- The FIPI Awards 2021 will present the Sustainable Growing Corporate of the Year Award.
- BPCL receives the Global Platinum Award 2021 from the Energy & Environment Foundation.
- Award for the best digital customer experience strategy.
- Award for Excellence in Customer Experience Management from SAP, the ACE Disruptor 2021.
2020
- The Energy and Environment Foundation has awarded the global sustainability category the 2020 Platinum Award.
- Special Recognition for Excellence in Learning and Development in the SHRM Award.
- Awards for CII Environmental Projects.
- 2020’s Corporate Citizen of the Year.
- Supply Chain in Manufacturing Award.
2019
- Golden Peacock Sustainability Award for Fiscal Year 2018–19.
- Awards for Social and Business Enterprise Responsibility from Grant Thornton (SABERA).
- Best Social Media Strategy: Global CX Summit Exceptional Experience Awards.
Campaigns and Advertisements for Bharat Petroleum
The business ran a video campaign for the New Year earlier this year. The brand intended for the ad to focus on the problems and trials people face on their journeys, and it encouraged them to stay inspired with BPCL’s assistance.
Through a strong social media presence, the business actively engages with its clients. You may email the business or follow it on Facebook, Instagram, Twitter, and LinkedIn.
Bharat Petroleum – Acquisitions and Mergers
The corporation, which had earlier merged with Oman Oil to form BORL, bought the business in 2021 for $24 million, or 36.62% of the stock. This made it possible for BPCL to fully own BORL as a subsidiary.
The business has made two substantial investments. The most recent investment was made by Medtel Healthcare on August 24, 2018, when it raised $10 million. Before that, on July 29, 2016, FINO PayTech raised $37.6 million with the help of the main investor BPCL.
Challenges Faced by Bharat Petroleum
The business just announced that its net profit for the quarter that ended in March 2022 decreased by 82%. This is because, despite a rise in fuel prices, there are still some uncertainties. Several oil marketing companies have also seen this loss. This occurs after the price of crude oil on the global market stayed above $100 per barrel.
Refinery throughput dropped in the January-March quarter, from 8.39 million tonnes a year earlier to 8.12 million tonnes, according to BPCL. Its market sales did rise from 11.17 million tonnes to 11.82 million tonnes.
Future Plans for Bharat Petroleum
The business will soon begin a project dubbed “Petrochemical Diversification.” To offer a more appealing higher value addition than transportation fuels, it intends to diversify in this sector. The project will receive an investment from the corporation of over Rs 13,000 crore.
edited and proofread by nikita sharma
