Saudi Aramco to acquire 20% of Reliance Industries’ oil business

Indian conglomerate Reliance Industries has announced that Saudi Arabian national oil company Saudi Aramco is to acquire a 20% stake in its oil to chemicals business.

Saudi Aramco and Reliance signed a non-binding letter of intent for the deal on 12 August. The stake taken would value the oil to chemicals business of Reliance, incorporating refining, petrochemicals and fuels marketing, at $75bn.

In its 12 August press release, Reliance hailed the pre-existing relationship of Reliance and Saudi Aramco, which has resulted in an approximate 2bn barrels of crude oil being processed at Reliance’s Jamnagar refinery. Upon the deal’s completion, Saudi Aramco would supply 500,000 barrels of oil per day to the refinery.

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Mukesh Ambani, Chairman and Managing Director of Reliance said: “I am truly delighted to welcome Saudi Aramco, one of the largest business enterprises in the world, as a potential investor in our Oil to Chemicals division. We have a long-standing crude oil relationship with Saudi Aramco and we would be happy to see this further strengthened with this investment. Saudi Aramco’s interest is a strong endorsement of the quality of our assets and operations as well as of the potential of India.” 

The investment is subject to the usual approvals from regulators, with the two companies saying that they would announce the conclusion of a definitive agreement.