HPCL to raise Rs 1,260 cr for capex

State-run refiner Hindustan Petroleum Corporation is planning to raise $200 million (Rs 1,260 crore) by this August, which would be used for its expansion, a company official and a banker confirmed.

“The funds would be used for our ongoing capital expenditure programme. We would also be using the funds to finance our ongoing four pipeline projects,” said the HPCL official.

The projects would be completed by the year-end. These pipelines — Rewari-Kanpur product pipeline, Uran-Chakan-Shikrapur LPG pipeline, Mangaluru–Hassan-Mysuru LPG pipeline and Awa-Salawas pipeline — are being built at the cost of Rs 2,356 crore.

Fitch Ratings said it assumed an average annual capex (capital expenditure) of Rs 8,000 crore for HPCL over the next two financial years. The Rewari-Kanpur pipeline would help HPCL save on logistic cost. The total project cost is Rs 1,210 crore. The objective of the Uran-Chakan-Shikrapur LPG pipeline, being laid at the cost of Rs 310 crore, is to reduce the tanker movement on Mumbai-Pune route. Bharat Petroleum Corporation Limited is a 50 per cent partner in this project. It is expected to be completed by this October.

The Mangaluru–Hassan-Mysuru LPG pipeline will reduce the bulk tanker movement along with roads between Mangaluru, Bengaluru and Mysuru. The project, estimated to cost Rs 701 crore, is expected to be completed by this November.

The Awa-Salawas pipeline will cost Rs 134 crore and is expected to be completed by November.

Hindustan Petroleum Corporation Ltd.(HPCL)