India’s Reliance talks on stake sale to Saudi Aramco hit a roadblock
July 24 2019 12:04 AM
RELATED STORIES
A Reliance Industries
A Reliance Industries petrochemical plant is seen at night in Jamnagar, Gujarat.

Reuters/New Delhi/Dubai

India’s Reliance Industries talks to grant a minority stake in its refining assets to Saudi Aramco have hit a roadblock over the valuation and structure of the deal, two people familiar with the matter said.
State-owned Aramco, the world’s biggest oil producer, plans to boost investment in refining and petrochemicals to secure new markets for its crude and sees growth in chemicals as central to its downstream strategy to reduce risk as oil demand slows.
Reliance had held talks on offering Aramco at least 20% in a special purpose vehicle covering refining, petrochemicals and marketing, and with a focus on expansion.
“Talks have stalled as Reliance is asking for a higher valuation and wants to transfer debt of the holding company to the new SPV (special purpose vehicle),” said one of the sources.
No immediate comment was available from Reliance and Saudi Aramco.
Reliance, controlled by Asia’s richest man, Mukesh Ambani, operates the world’s biggest refining complex with capacity to process 1.4mn barrels per day (bpd) of oil at Jamnagar in western India.
It plans to expand capacity to 2mn bpd by 2030, according to plans shared with the Indian government.
As of June 30, Reliance had outstanding debt of Rs2,882.43bn ($41.8bn) compared with Rs2,875.05bn as of March 31, while cash and cash equivalents as of June 30 were at Rs1,317.10bn versus Rs1,330.27bn as of March 31, the company said.
Aramco and the United Arab Emirates’ national oil company ADNOC teamed up with state-run Indian refiners last year in a plan to build a 1.2mn bpd refinery and petrochemical project in India’s Maharashtra state.
But the planned refinery, initially expected to cost $44bn, faces delays, as farmers have refused to surrender land forcing the Maharashtra government to find a new location in Raigad district, about 100km (62 miles) south of Mumbai.



There are no comments.

LEAVE A COMMENT Your email address will not be published. Required fields are marked*
MORE NEWS