BPCL to Raise Up to $3 Billion Through Global Bond Sale

Bharat Petroleum Corporation Ltd (BPCL) is preparing an international bond sale of up to $3 billion to fund its Brazil SEAP-I offshore oil project and refinance upcoming debt.

New Delhi: Bharat Petroleum Corporation Limited (BPCL) is preparing to raise as much as $3 billion through an international bond sale, with the bulk of the proceeds expected to fund its investment in a major offshore oil and gas project in Brazil and refinance debt due next year, according to people familiar with the matter.

India’s second-largest state-owned oil refiner is considering raising the funds through multiple tranches. BPCL has also held investor roadshows in London, Dubai and Singapore to gauge demand for the proposed bond issue, according to the reports.

$2.8 Billion Brazil Investment

A major portion of the proposed fundraising is expected to support BPCL’s $2.8 billion contribution to the SEAP-I offshore development in Brazil.

BPCL’s wholly owned subsidiary, Bharat PetroResources Limited (BPRL), holds a 40% stake in the project. Brazil’s state-controlled oil company Petrobras operates the project and holds the largest stake in the BM-SEAL-11 area, which includes SEAP-I.

The SEAP-I development is expected to have the capacity to produce around 120,000 barrels of oil per day and process approximately 10 million cubic metres of natural gas per day when fully operational. Oil production is targeted to begin in 2030, while gas exports are expected to start in 2031.

BPCL Strengthens Overseas Energy Strategy

The proposed bond issue comes as India seeks to diversify its crude oil supply sources amid geopolitical disruptions in traditional energy-producing regions.

India imports nearly 90% of its crude oil requirements, making overseas oil and gas investments an important part of its long-term energy security strategy. India’s crude imports from Brazil have also increased significantly this year, making Brazil one of the country’s important emerging crude suppliers.

The Brazil project could therefore give BPCL a larger presence in South America’s oil and gas sector while helping India diversify its sources of crude supply.

Project Approved Earlier This Year

The SEAP-I project received its final investment decision earlier this year following delays related to securing a floating production, storage and offloading vessel.

The discoveries in the area were declared commercially viable in 2021, while a development plan was submitted to Brazil’s oil regulator the following year.

For BPCL, the proposed international bond sale represents a significant overseas fundraising exercise and comes as the company expands its upstream investment strategy beyond India.