BPCL likely to increase naphtha supply in 2017

India's Bharat Petroleum Corp Ltd (BPCL) is expected to increase its naphtha spot supply once it completes the expansion of its Kochi refinery in 2017, industry sources said on Wednesday.

It will likely offer two naphtha cargoes per month from Kochi, compared with the current two cargoes per three months, after the completion of the expansion, one of the sources close to the matter said.

BPCL is expected to expand the capacity of its Kochi refinery in southern India to 310,000 barrels per day from the current 190,000 bpd in the next fiscal year.The company's naphtha exports have reduced over the past two years as it maximised its yield to produce more gasoline to meet domestic demand and as it processed heavier crude grades, the source added.

BPCL used to export two naphtha cargoes every month from Kochi about two years ago, but has since reduced this to two cargoes every three months, the source added.

This in turn has been supporting naphtha margins, traders said.

BPCL also exports two naphtha cargoes every month from Mumbai, traders said. Those volumes are expected to remain unchanged.