Aramco to take 20% stake in RIL’s downstream business
Saudi Aramco and Reliance Industries Ltd. have signed nonbinding letter of intent regarding Aramco’s proposal to purchase a 20% stake in RIL’s oil-to-chemicals division, which includes its refining, petrochemicals, and fuels-marketing businesses.
Saudi Aramco and Reliance Industries Ltd. (RIL) have signed nonbinding letter of intent regarding Aramco’s proposal to purchase a 20% stake in RIL’s oil-to-chemicals (O2C) division, which includes its refining, petrochemicals, and fuels-marketing businesses.
Based on an enterprise value of $75 billion, Aramco’s planned investment would be one of the largest foreign investments ever made in India, RIL said.
While few details about the letter were revealed, RIL did confirm the proposed investment would result in Aramco supplying 500,000 b/d of Arabian crude oil to RIL’s 580,000-b/d Jamnagar integrated refining and petrochemical complex in Gujarat on a long-term basis.
The crude-supply portion of the agreement follows an already established 25-year supply relationship between the parties under which, to date, Aramco has supplied about 2 billion bbl of crude to Jamnagar, RIL said.
Under the nonbinding letter, the proposed O2C investment is subject to due diligence, and the executed definitive agreement will be subject to regulatory and other customary approvals.
RIL said the parties will make an announcement once a definitive agreement is executed.
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