Page 8 - AsianOil Week 47 2021

AsianOil SOUTH ASIA AsianOil

Aramco pulls out of one Indian

deal, announces another

Reliance and Aramco have called off their planned $15bn downstream tie-up while
the Saudi firm has already started talks with ONGC for major crude offtake deals

COMMENTARY SAUDI Aramco and India’s Reliance Industries The move follows a pledge by Reliance owner
Ltd this week called off a major downstream Mukesh Ambani in June that the company
deal following years of talks, but the Saudi firm would invest around $10bn in low-carbon ener-
WHAT: wasted no time in opening discussions with gies over the next three years and investments
The deal would have another Indian state giant for crude offtake. in Norwegian solar module maker REC Solar
added Reliance’s massive With the multi-billion dollar Reliance deal (100% for $771mn) and renewables service firm
Jamnagar refining now appearing to have been scrapped altogether, Sterling & Wilson Solar (40% for $379mn).
complex to Aramco’s Aramco and Oil and Natural Gas Corp. (ONGC) Under plans to become net-zero by 2035, Reli-
gross refining capacity, signed a memorandum of understanding (MoU) ance will develop a $8.2bn Dhirubhai Ambani
achieving one of its key to explore potential supply deals. Green Energy Giga Complex alongside its
long-term downstream world-leading downstream facility at Jamnagar.
goals. RIL breakdown The new facility will include units for fuel cells,
Reliance said it and Aramco had come to a integrated solar photovoltaic modules, batteries
WHY: mutual decision to scrap a planned deal for the and electrolysers for producing green hydrogen.
Talks broke down latter to acquire a 20% stake in the former’s spun- The solar module facility will have an initial
amid talk of Reliance’s off oil-to-chemicals (O2C) division. capacity of 4 GW and the company has plans to
strategic refocus on clean Noting that the company’s strategic focus was expand this to 10 GW.
and renewable energies, shifting towards renewables, Reliance added that Reliance O2C owns and operates a refining
though the parties are it would also no longer spin off the O2C division. slate of 1.82mn bpd comprised of the world’s
understood to remain “Due to evolving nature of Reliance’s largest refining complex at Jamnagar and
keen to collaborate business portfolio, Reliance and Saudi Ara- another sizeable facility located within the Jam-
despite failure to agree mco have mutually determined that it would nagar Special Economic Zone. It also has 38.4mn
on a deal. be beneficial for both parties to re-evaluate tpy of petrochemicals capacity, which processes
the proposed investment in O2C business around 60% of its refining output.
WHAT NEXT: in light of the changed context,” it said. Ara- The division also comprises a bulk wholesale
An MoU with ONGC mco is yet to comment on the deal, which marketing business, a fuel retail arm which com-
appears likely to lead was seen adding 364,000 barrels per day prises a 51% stake in a JV with BP and oil trading
to long-term crude and (bpd) and 7.7mn tonnes per year (tpy) to subsidiaries in Singapore and the UK.
refined product supply the company’s net global refining and pet- Talks between Aramco and Reliance had
deals that will give rochemicals capacities. been running since August 2019, when Ambani
Aramco a firm footing in
India.

P8 www. NEWSBASE .com Week 47 26•November•2021