Published: Wed, April 11, 2018
Tech | By Tabitha Holland

Saudi Aramco signs $44bn deal to build giant oil refinery in India

Saudi Aramco signs $44bn deal to build giant oil refinery in India

Saudi Aramco has signed a memorandum of understanding (MoU) with Ratnagiri Refinery and Petrochemicals Ltd (RRPCL), a consortium of Indian oil companies which includes The Indian Oil Corp.

"We're very much interested in retail ..."

Aramco, like other major producers, wants to tap rising demand growth and invest in the world's third-biggest oil consumer.

Apart from investing in the project, Aramco will also supply crude oil to the project, ensuring supply security.

Saudi Arabia is competing with Iraq to be India's top oil supplier. 18 million tonnes per annum of petrochemical products.

Texas Governor Greg Abbott is expected to attend an event in Houston on Saturday where Saudi Crown Prince Mohammed bin Salman, Saudi Energy Minister Khalid al-Falih and Saudi Aramco Chief Executive Amin Nasser are to discuss the plans, according to a Saudi Aramco representative.

"The project is designed as 50:50 (joint venture between Indian and foreign companies)". The company hopes to complete the expansion within two or three years. "We are managing the global block", he said. "There is one worldwide company which has already expressed interest and we have taken note of it and in due course we will address it", he added. Of this, the IOC's share will be half, with the rest equally shared by HPCL and BPCL.

There are three offshore contracts now under execution by the consortium for Saudi Aramco under the long-term agreement.

He also visited areas affected by Hurricane Harvey which have been rebuilt as a result of Saudi Aramco US subsidiary Aramco Services Company's contribution under the Houston Habitat for Humanity initiative. It is the company's largest research center outside Saudi Arabia.

But Motiva wants to first move into petrochemicals, using abundant natural gas from US shale fields to make the precursors for plastics, the sources said.

India said on Monday its state refiners could become cornerstone investors in. "The reforms that Prime Minister Narendra Modi has brought over the last few years are nothing but a game changer".

"Furthermore, this project will enable us to strengthen our ties with Saudi Aramco, with whom we successfully operate our biggest and most efficient refinery in the world".

India has a refining capacity of 232.066 million tonnes, which exceeded the demand of 194.2 million tonnes in 2016-17 fiscal.

Noting that the future supply situation of energy sources, particularly of oil, is "not reasssuring", Al-Falih said the producers in the Organisation of Petroleum Exporting Countries (OPEC) "remain committed to the long-term market".

This is published unedited from the PTI feed.

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