Last updated : August 17, 2026 7:51 am
Our objective is to transform NRL from a traditional refinery into an integrated energy and chemicals company
Bhaskar Jyoti Phukan, Managing Director, Numaligarh Refinery Limited (NRL)
NRL is currently executing one of the largest industrial projects in Northeast India. How is NRL overcoming logistical and supply chain challenges to meet the targeted deadline?
Northeast India’s distance from major manufacturing hubs creates unique logistical challenges for sourcing refinery equipment. By leveraging inland waterways via the Brahmaputra and its tributaries, we efficiently transport heavy, over-dimensional components—some weighing up to 1,500 tonnes—directly to our dedicated jetty near the refinery site.
The project has weathered multiple disruptions over time. Notably, during the COVID-19 pandemic, design and engineering timelines were extended because engineering teams and licensors transitioned to remote work.
Recent geopolitical volatility has disrupted our supply chain and material costs. While the Ukraine conflict initially caused sharp fluctuations in steel and aluminum pricing, escalating Middle East tensions are now constricting the supply of copper-dependent electrical and instrumentation materials. Additionally, widespread shipping disruptions are delaying transit times.
Despite these challenges, the project is now in an advanced stage. Connectivity has improved dramatically through highways, railways, waterways, and air freight options, giving us multiple alternatives to manage critical deliveries.
What is the timeline for commissioning the Numaligarh Refinery Expansion Project?
We have entered the commissioning phase. Utilities are active, crude oil is introduced into the mother unit, and primary processing will soon ramp up in phases. The commissioning sequence follows standard refinery practice: Utilities first, followed by primary units, and then secondary units. We expect plant-by-plant commissioning to continue throughout the year and we remain confident that the complete project will be commissioned by March 2027.
NRL recently achieved Navratna status. How does that change the company's growth trajectory?
Gaining Navratna status has completely transformed our business. Previously, as a Miniratna company, major capital expenditure required a slow, multi-level clearance process, including cabinet approval for limits beyond our financial authority. Today, our board has much greater financial autonomy. This enables us to evaluate and approve strategic investments much faster, allowing NRL to respond quickly to emerging opportunities. The refinery expansion unlocks our downstream potential, providing the necessary scale to pursue new ventures. Because many petrochemical projects require large, consistent raw material streams to be profitable, this capacity boost creates a strong foundation for future business growth.
Petrochemicals are becoming increasingly important for refiners. What are NRL's plans?
One of our most significant downstream initiatives is a 360 KTPA Polypropylene project. This project becomes feasible only because the expanded refinery will generate adequate propylene volumes from the PFCC unit. Scale is the cornerstone of petrochemical profitability; without refinery expansion, these projects simply are not commercially viable. By pivoting to polypropylene, we advance up the value chain to capture significantly higher profit margins than we would by selling the base stream as LPG.
With substantial investments flowing into expansion, what is your strategic roadmap for maintaining strong margins and shareholder returns in next 3-5 years?
We drive profitability through operational agility. Our Petrochemical Fluid Catalytic Cracking (PFCC) unit swiftly toggles between diesel and petrol outputs to capitalize on market conditions, while our Residue Processing and Treating Unit (RPTU) upgrades heavy fractions into high-margin distillates. We are also expanding into high-value offerings like Polypropylene and Sustainable Aviation Fuel (SAF). We have already started preparing the engineering package for SAF production. The project will utilize feedstocks such as used cooking oil (UCO), palm oil, and palm oil mill effluent (POME). The idea is to use existing refinery assets and convert part of our diesel-oriented infrastructure toward SAF production. This aligns with global decarbonization trends while also improving profitability.
How is NRL preparing for long-term energy transition?
We are building flexibility into our portfolio. If diesel demand remains strong, we are well positioned to serve the market. If alternative fuels such as LNG, EVs, or other technologies accelerate faster than expected, we have plans to increase aviation fuel production, expand petrochemicals, develop a naphtha cracker, and diversify into specialty chemicals. The bio-refinery also creates opportunities to manufacture specialty molecules such as acetic acid, which can serve pharmaceutical KSM and API value chains. We are actively evaluating these opportunities.
What is the current status of NRL's green hydrogen and integration of biofuel initiatives?
We have two green hydrogen projects. The first is a 2.4 KTPA green hydrogen facility being developed by NRL itself. We expect it to be commissioned by the end of calendar year 2027. The second is a 10 KTPA project under a Build-Own-Operate (BOO) model for which the contract has already been awarded to NeuEN Green Energy Pvt. Ltd., a 50:50 joint venture between Bharat Petroleum Corporation Limited (BPCL) and Sembcorp Green Hydrogen India. The discovered hydrogen price is below Rs. 300 per kilogram, which we consider encouraging. While geopolitical disruptions have caused some delays, the project is expected to commence once conditions stabilize. The facility will be located adjacent to the refinery and will have access to existing water and power infrastructure, making project execution easier.
NRL pioneered India's first commercial-scale bamboo-based 2G bioethanol refinery. What impact is it having?
NRL's breakthrough 2G bio-refinery converts regional surplus bamboo into clean fuel, bypassing the food-versus-fuel conflict entirely. By creating a structured ecosystem—spanning laboratories, nurseries, and rural pre-processing units—the project secures a green supply chain while driving localized economic growth. The pioneering facility has successfully overcome early technical hurdles and is rapidly moving toward operational stabilization. At full capacity, the refinery will inject Rs. 200 crore annually into the rural economy, directly benefiting farmers, entrepreneurs, and logistics partners across a 350-km catchment area.
What level of capital expenditure is planned for FY27?
Our planned capital expenditure for FY 2026-27 is approximately Rs. 8,000 crore. Last year, Capex was close to Rs. 9,000 crore. Most of the FY27 investment will go toward completing the Numaligarh Refinery Expansion Project and initiating investments in the Polypropylene project. Beyond that, NRL will continue investing in sustainability and net-zero initiatives although those projects will not be of the same scale as the expansion project.
How is NRL leveraging AI and digital technologies to improve refinery performance?
Digital transformation has been a major focus area. Since 2010, our Energy Intensity Index has improved from 117 to around 70. Achieving even a one-point improvement in this metric requires significant fuel savings, so the cumulative impact has been substantial. We have invested heavily in Asset Integrated Management Systems (AIMS), Reliability-Centered Maintenance (RCM), advanced process control, and predictive analytics. Around 300 pumps are connected to a centralized monitoring system that tracks vibration and operational parameters in real time. We are now adding AI layers to derive deeper insights and improve equipment reliability further. We have also collaborated with IIT Guwahati to develop an LLM-based procurement platform that assists in tender evaluation and procurement processes. The first version has already been deployed and further enhancements are underway.
How do these initiatives contribute to NRL's carbon reduction and energy efficiency goals?
Energy efficiency is directly linked to carbon efficiency. Every unit of energy saved translates into lower emissions. One of the major sources of carbon dioxide emissions in a refinery is hydrogen production. Our current hydrogen generation capacity is about 48 KTPA. Out of this, we have already planned to replace 2.4 KTPA with green hydrogen. This alone will lead to a significant reduction in carbon emissions.
We have already prepared a roadmap toward achieving net-zero emissions. The strategy includes increasing green hydrogen usage, improving energy efficiency, procuring renewable power, and manufacturing products that have a lower lifecycle carbon footprint. For example, conventional fuels like diesel generate carbon dioxide during their end-use phase. Therefore, we are also focusing on products and fuels that can reduce emissions across their lifecycle.
Another major initiative is reducing Scope 1 and Scope 2 emissions. We currently operate captive power generation facilities, but going forward, we plan to procure more renewable energy. The combination of green hydrogen, renewable power, and low-carbon fuels will substantially reduce our overall carbon footprint.
How does NRL manage crude procurement and margin optimization amid global geopolitical uncertainties?
At present, crude prices remain internationally benchmarked and there have been no major disruptions in supply. Therefore, we have been relatively insulated from geopolitical developments in the Middle East. However, once the expanded refinery begins operating at six million tonnes per annum capacity, we will naturally be exposed to the same global market dynamics as other refiners.
The advantage we have is refinery complexity. Our upgraded refinery will be capable of processing a wide variety of crude grades from across the world. This flexibility allows us to optimize our crude basket by selecting the most economical feedstocks available globally.
The Paradip–Numaligarh crude oil pipeline which is now mechanically complete, will further strengthen supply security and provide greater flexibility in sourcing crude. This will place us in a much stronger position to manage market volatility. Regarding crude prices, current indications suggest that the market may move toward a more balanced or even oversupplied situation due to demand moderation in certain regions. We do not foresee any prolonged period of extremely elevated crude prices. Short-term fluctuations will continue but sustained price spikes appear less likely.
What has been the investment in the Paradip–Numaligarh pipeline project?
The combined investment in the pipeline project is approximately Rs. 9,000 crore. This is a critical strategic infrastructure project that will support the expanded refinery's crude requirements and strengthen long-term supply reliability.
NRL exports petroleum products to Bangladesh. Have you faced any geopolitical or regulatory challenges in cross-border operations?
Fortunately, we have not encountered any significant challenges. Bangladesh requires reliable hydrocarbon supplies and we have remained a dependable supplier. The existing pipeline connectivity ensures smooth product movement with only limited border-crossing requirements. There has been a clear mutual understanding between both countries regarding the importance of energy cooperation. The quantities being exported are relatively modest and the arrangement has continued without major disruptions. As of now, our cross-border operations remain stable and unaffected.
The refinery is located near the environmentally sensitive Kaziranga region. How does NRL balance industrial operations with environmental conservation?
Environmental stewardship has always been a major priority for us. We have implemented continuous environmental monitoring systems to track emissions and ensure compliance with regulatory norms. Air quality, water quality, and other environmental parameters are monitored continuously. Over the years, we have not observed any adverse impact attributable to refinery operations on the surrounding ecology. Nevertheless, we continue investing in additional environmental protection measures.
One major achievement has been reducing freshwater consumption. Earlier, our freshwater intake was significantly higher, but through recycling, reuse, and conservation initiatives, we have dramatically reduced freshwater requirements. We are also implementing additional wastewater recovery and water management projects that will further lower freshwater dependence in the coming years.
Beyond refining, how is NRL contributing to the broader development of Northeast India?
Our contribution extends far beyond refinery operations. Gas infrastructure development is one example. Multiple gas pipelines are being developed and interconnected across the region which will encourage industrial development and attract new investments. We also engage local transporters, suppliers, contractors, and service providers throughout our operations. Through our CSR initiatives, we support healthcare, education, skill development, and community welfare projects not only in Assam but also in neighbouring states such as Nagaland, Manipur, and Mizoram. We believe that economic development should be inclusive therefore we continuously reinvest resources into communities and stakeholders who support our operations. In addition, a significant percentage of our workforce comes from the Northeast, creating long-term employment opportunities for local youth.
Are there plans to develop a downstream petrochemical ecosystem around refinery?
The Polypropylene (PP) project is only the beginning. We are actively exploring opportunities to attract downstream plastic processing and petrochemical manufacturing units around the refinery. The refinery and neighbouring petrochemical assets can provide feedstocks for a range of industries. Basic materials such as Polypropylene can support development of value-added manufacturing clusters. We are already engaging with potential investors and manufacturers. The region now has several advantages, including feedstock availability, power connectivity, water treatment facilities, and industrial infrastructure. Many of these downstream projects do not require very large investments individually but collectively they can create a substantial industrial ecosystem and generate significant employment. We are very optimistic that such developments will gain momentum in the coming years.
What is your long-term vision for NRL?
Our objective is to transform NRL from a traditional refinery into an integrated energy and chemicals company. We have invested heavily in creating a world-class energy and industrial platform in the Northeast. Our aspiration is not only to grow NRL as a company but to also contribute meaningfully to the development of region and nation.