Saudi Aramco, entered into an agreement to hold 50 percent stake in a planned US$ 44 billion refinery-cum-petrochemical project in Maharashtra,
Saudi Aramco, the world’s second-largest oil company, signed an agreement to acquire 50 percent stakes in a new project in Maharashtra, India. This is a US$ 44 billion refinery-cum-petrochemical project, and investment by Saudi Aramco will give it an assured customer for additional 30 million tons of its crude oil.
Aramco, has revealed future plans to dilute some of its 50 percent equity stake in the 60 million ton-a-year refinery project in favor of another strategic investor. The national oil company in Saudi will supply half of the crude oil required for processing at the refinery.
The remaining 50 percent of the stake will be distributed among leading refiners in India such as Indian Oil Corp (IOC), Hindustan Petroleum Corp Ltd (HPCL), and Bharat Petroleum Corp Ltd (BPCL).
“As large as this project may be, this does not by itself satisfy our desire to invest in India. Aramco will not stop discussing other opportunities because we see India as a priority destination for our investment and energy supplies,” said the Oil Minister at Saudi.
Aramco intends to increase its consumers among the world’s third-largest oil consumer, through this investment. UAE and Kuwait are also looking at investing in projects in return for getting an assured offtake of their crude oil.
Aramco’s participation is expected to bring expertise to the project, also helping cut down financing cost by the country. Aramco said it will continue to pursue other investment opportunities in Indian oil and gas sector, and also intends to entry into fuel retailing.