Bharat Petroleum Corporation (BPCL) and Videocon Industries with Brazilian partner Petroleo Brasileiro SA (Petrobras) have found more light crude oil in the Sergipe Basin off that country’s northeast coast, the companies said in a securities filing.

The discovery in the BM-SEAL-11 exploration block is believed to hold at least a billion barrels of recoverable oil.

Sao Paulo: Brazil’s state-run oil company Petroleo Brasileiro SA (Petrobras) and its Indian partners—Videocon Industries Ltd and Bharat Petroleum Corp. Ltd (BPCL)—have found more light crude oil in the Sergipe Basin off Brazil’s Northeast coast, according to a securities filing on Thursday.

The discovery in the BM-SEAL-11 exploration block is one of several in recent years in an area believed to hold more than 1 billion barrels of recoverable oil, or enough to supply all needs in the US for nearly 2 months.

State-run Bharat Petroleum Corporation Ltd (BPCL) is planning to raise Rs 4,000 crore for the expansion of its Kochi refinery and to fund its petrochemicals venture, said three banking sources aware of the development. State Bank of India (SBI) has received the mandate to raise funds.

BPCL is planning to diversify into downstream petrochemicals with an investment of Rs 4,588 crore by using propylene. The public sector refiner is planning to produce niche petrochemicals such as acrylic acid, acrylates and oxo alcohols, which are predominantly being imported into the country, at its Kochi refinery facility, using the polymer grade propylene that will be available after the ongoing integrated refinery expansion project (IREP) is completed.

Shares of state-owned oil marketing companies such as Indian Oil Corp, Hindustan Petroleum and Bharat Petroleum were up 1-3% each gained in an otherwise weak market as global crude oil prices dropped to fresh 51/2 year lows today.

Lower crude oil prices would help reduce the under-recoveries on sale of subsidised cooking fuels such as kerosene and LPG gas for domestic use.

The government on Thursday raised excise duty on petrol and diesel by Rs 1.50 a litre each to help it achieve the fiscal deficit target for this year. The move may not result in an immediate hike in prices of petroleum products as oil marketing companies (OMCs) are likely to offset it by not announcing the reduction in rates expected this weekend.

The excise duty on normal or unbranded petrol was hiked from Rs 1.20 per litre to Rs 2.70 per litre and on unbranded diesel from Rs 1.46 a litre to Rs 2.96, a government notification said. The duty on branded petrol was raised from Rs 2.35 a litre to Rs 3.85 and on branded diesel from Rs 3.75 to Rs 5.25 per litre.

State-owned Bharat Petroleum Corp Ltd aims to double its refining margins once it completes the expansion and upgrade of its Kochi refinery in Kerala to process high sulphur crudes by 2016, a senior company official said.

The refiner's margins dropped to $3 a barrel this year, from $4.50 to $5 a barrel last year, but levels will increase by a about $3 to $4 a barrel by mid-2016, said Neeraj Shukla, a chief manager at BPCL's refineries division.

State-owned Oil and Natural Gas Corp (ONGC) has edged past Reliance Industries (RIL) to be the highest-ranked Indian energy firm on this year's Platts Global 250 Rankings.

ONGC, ranked 22 in 2013, improved one position this year on the list led by global firms Exxon Mobil Corp, Chevron and Royal Dutch Shell. RIL slipped from the 19th rank in 2013 to 22nd.

Rio De Janeiro: Brazil’s state-run oil company Petroleo Brasileiro SA (Petrobras) discovered natural gas in a well being drilled to help measure the potential of a giant Brazilian offshore find, the company said in a securities filing on Wednesday.

Petrobras owns 75% and its Indian partner Oil and Natural Gas Corp. Ltd (ONGC) 25% of the discovery.

The discovery was made in an extension well being used to evaluate the Poco Verde prospect in the BM-SEAL-4 block. The well was drilled in 2,196 meters of water 58km off the coast of Aracaju, the capital of Brazil’s Sergipe state.

With the difference between the sale price and the market (non-subsidised) price of diesel dropping to a historic low of 8 paisa/litre on Monday, analysts believe that Bharat Petroleum Corporation (BPCL) is likely to gain the most from the falling under-recoveries.

Analysts cite cheaper valuations and stronger refining performance as key positives for the stock. “We prefer BPCL, where core performance is the strongest, with the stock at 11x P/E under such a scenario despite the 65% price rise in 2014,” Barclays said in a report.

State-run Bharat Petroleum Corporation (BPCL) has reported an eight fold increase in net profit for the April-June quarter.

The company's net profit stood at Rs 1,216.3 crore, led by higher other income and lower finance cost. Net profit for the year-ago period was Rs 150.3 crore.

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