Balmer Lawrie & Co announced plans to gradually exit its refinery and oilfield services business, citing viability challenges. The company will taper down operations, refrain from taking new orders, and stop bidding for future projects in this segment. “Our plan is to exit this business. Over time, the MSME sector has exerted pressure on this segment, and it is no longer viable for us to continue,” said Adhip Nath Palchaudhuri, Chairman and Managing Director of Balmer Lawrie & Co. He noted that refinery and oilfield services have always been a small-scale operation for the company.
Refineries and Oilfield Services: Niche but Challenging
Balmer Lawrie’s Refinery and Oil Field Services (ROFS) specializes in mechanized oily sludge processing and hydrocarbon recovery from crude oil storage tanks and lagoons. The segment was a pioneer and market leader in oily waste recycling for over two decades. However, it faced lower-than-expected financial and operational performance due to weak market demand, price sensitivity, and intense competition.
Strategic Shift Towards Logistics and Commodities
As reported by thehindubusinessline.com, the company currently handles finished steel cargo via rail logistics under the Liberalised Special Freight Train Operator (LSFTO) Scheme of Indian Railways. It primarily serves the Rourkela Steel Plant of SAIL. Balmer Lawrie plans to expand into long-haul transportation of other commodities, including fertilizers and chemicals, adopting a more opportunistic and market-responsive strategy. “We will react and respond to market triggers, leveraging opportunities as they arise,” added Palchaudhuri.
