Saudi Aramco considers buying stake in Indian refineries

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New Delhi, Feb 24 : Saudi state-run oil giant Aramco is looking to buy stake in existing Indian refineries and in their capacity expansion, as well as in the proposed petrochemicals refinery on India’s west coast, Saudi Arabian Energy Minister Khalid bin Abdulaziz al-Falih said on Saturday.

Speaking to reporters here during his ongoing official visit to India, Al-Falih said Aramco had already signed an agreement to initiate talks for acquiring stake in the proposed Rs 1.8 lakh crore refinery in Maharashtra.

“Aramco is also looking at other opportunities to buy into existing refineries in India as well as upgrades of existing refineries. So, there are at least three different tracks which I cannot reveal more specifics,” said the Saudi Minister, who also looks after the industry and mineral resources portfolios.

“Agreements have been already signed that allows discussions to start on the configuration of the (west coast) refinery, on design basis and pre-feasibility studies,” he said.

“One is the greenfield west coast refinery, which is already public, but there are discussions with expansions as well as buying stake into major existing refinery assets. All of these are illustrated commitments by the Kingdom and the company to be not only a supplier, but an investor in India at an unmatched scale,” he added.

According to Al-Falih, “India is open for partnership, open for business, we welcome that, we welcome Prime Minister (Narendra) Modi’s pro-business environment, we believe in it, we believe its here to stay and have told Aramco team to assign zero political and regulatory risk to India and treat it as part of Saudi Arabia.”

“The projects will have risks, the markets will have risk, but India has no risk. And we are here to invest, we are here to grow, we are here to be part of India’s landscape. We will be received with open arms and we don’t take that for granted. We will match that with commitment, with action and with unmatched flow of FDI,” he added.

Regarding at the quantum of stake in the west coast refinery proposed to be bought by Aramco, the Minister said: “The more the better. But certainly we are not constrained by capital, and we are not constrained by feed stock, and we are not constrained by size.”

Queried on Aramco’s interest in fuel retailing in India, Al-Falih said the company is agreeable “in principle”.

“But I will leave that to Aramco downstream organisations to look at. I’m not used to the complexities,” he added.

Following a meeting here on Friday with the Saudi Minister, Indian Petroleum Minister Dharmendra Pradhan had said that both the west coast refinery and the planned Rs 33,000 crore petrochemical complex in Andhra Pradesh had figured in the discussions.

During the meeting, Pradhan mentioned Saudi Arabia’s eminence as a leading import source for crude and LPG to India, an Indian Petroleum Ministry release said here.

“Both sides agreed to conclude discussions regarding concrete investment proposals in a time-bound manner,” it said.

Earlier this month, Modi’s second visit to the UAE had resulted in an Indian consortium gaining stake for the first time in oil resources in the Middle East.

An MoU was signed in Abu Dhabi between an Indian consortium comprising state-run explorer ONGC Videsh, Bharat PetroResources, Indian Oil and the Abu Dhabi National Oil Co (Adnoc) for acquisition of 10 per cent participating interest in the latter’s offshore Lower Zakum Concession.

Adnoc also signed an agreement with the Indian Strategic Petroleum Reserves Ltd to implement the strategic crude oil storage facility on India’s western coast in Mangaluru (Karnataka) for the storage of 5.86 million barrels of Adnoc crude in underground facilities.

Abu Dhabi is a constituent of the United Arab Emirates (UAE), which is a member of the Gulf Cooperation Council (GCC) that includes Saudi Arabia.