Critical analysis of the operations and eco-social impact of oil and gas public sector enterprises.
India is the sixth largest producer of chemicals in the world and third in Asia. Globally, India is the fourth-largest producer of agrochemicals after the United States, Japan and China. India’s current refining capacity is 250 MMTPA with a plan to increase this to 450 MMTPA by 2030. Currently there are 23 refineries, 18 Public Sector Undertakings (PSUs), 2 owned by joint ventures and 3 with private ownership. While Reliance Industries Limited is the largest petrochemical producer in the country, PSUs like Indian Oil Corporation Limited (IOCL), Bharat Petroleum Company Limited (BPCL) and Gas Authority of India Limited (GAIL) are the next big contributors.
The Minister for Petroleum and Natural Gas, in October 2024, said, “the petrochemical sector in India is projected to attract investments exceeding USD 87 billion in the next decade, representing over 10% of global petrochemical growth”. The Government of India has demonstrated its support to the industry in its allocation to the sector during the 2024-25 budget. The biggest increase in budget allocation in 2024-25 in the petroleum sector has been to petrochemicals, which saw a 60% jump from the previous year’s allocation. All PSUs are also seeing capacity expansion. The Government of India is also keen to set up a greenfield refinery in Ratnagiri as a joint venture between IOCL, BPCL and HPCL with two West Asian oil companies Saudi Aramco and Abu Dhabi National Oil Company (ADNOC).
While the Union Government is furthering petrochemical production by PSUs, it is important to assess the impacts of the existing PSU run petrochemical facilities on communities living in the peripheries. CFA initiated a study to analyse the environment and social impact of oil refinery and petrochemical PSUs in India. For the purposes of the study, 14 Public Sector oil refineries and 3 petrochemical plants were selected. 17 refineries were selected for this study based on their product mix and focussing on refineries producing polymers among other petrochemical products.
We hope that the findings of the study will help build evidence of the inadequate environmental norms governing the industry, the lack of security for workers and social impacts on fenceline communities.
Read and Download the full report here: State of PSUs in Oil Refining and Petrochemicals