California-based Chevron Corp is the worlds fifth largest integrated energy company while Exxon Mobil is the worlds largest publicly traded oil company. This will be the first foreign direct investment (FDI) by a global oil major in Indias booming refining sector. Earlier this month, UK-based BP Plc backed out of its commitment to buy equity in HPCLs Bhatinda refinery.
In lieu of a stake in its Rs 27,000 crore ($6 billion) plus refinery venture, RIL will seek assurance from the proposed strategic investor in two key areas - crude supplies for its export-oriented refinery and confirmed off-take of petroleum products for the overseas markets.
RIL chairman Mukesh Ambani is currently in the US meeting top executives of Chevron. Sources said Chevron chairman and chief executive David J OReilly met Mr Ambani on Tuesday. The RIL stock gained a marginal 0.37% or Rs 2.90 to end the day at Rs 793.95, after touching a high of Rs 797.40. A total of 6.41 lakh shares were traded on BSE on Wednesday. The stock has gained more than 12% in the last one month.
MUKESH'S MEGA PLAN
The new refinery will double RILs refining capacity to 12.5 lakh tonne
Petrol and diesel will make up 80% of the products produced by Reliance Petroleum Limited. However, bulk gasoline (petrol) will be converted into high octane gasoline for exports to the US. Typically, 70 per cent of the output will constitute auto fuels.
Also on Reliances radar is a possible technology pact with Chevron for sourcing some of the refining processes and possibly know-how for developing its D6 deep sea gas field in the Krishna Godavari Basin in the Bay of Bengal.