Bahrain Petroleum to Ask HSBC, BNP on $6 Billion RefineryArif Sharif and Wael Mahdi
Bahrain Petroleum Co. will ask HSBC Holdings Plc and BNP Paribas SA’s advice on raising at least $6 billion to increase its output, according to a banker familiar with the deal.
The banker asked not to be identified because the information is private and provided no further information. A spokesman for Bahrain Petroleum and a spokeswoman for BNP Paribas in Manama, Bahrain, declined to comment. HSBC did not respond to a phone call seeking comment.
Bapco, as the company is known, plans to spend $6 billion to $10 billion on expansion works that will increase daily production capacity at its only refinery to more than 450,000 barrels, from about 267,000 barrels now, the nation’s oil minister Abdul Hussain Mirza said in May last year. The work on the refinery should be completed by 2018, he said.
“The refinery’s plans are on schedule and I don’t see any changes to them at the moment,” Bapco Chairman Adel Almoayyed said by phone today.
Bahrain, which began pumping oil in the 1930s, is the smallest crude producer in the Gulf. It depends on Saudi Arabia, the world’s largest oil exporter, to supply it with 150,000 barrels a day of crude pumped from a shared oil field and delivered to Bahrain by pipeline to the refinery. The nation plans to raise the pipeline capacity by 120,000 barrels a day to 350,000 barrels in 2014, according to Mirza.
The front-end engineering and design of the pipeline expansion expansion should be completed in June and the works on the project should start in the second half, Khalid Sabbagh, general manager of marketing at Bapco said today by phone.