Saudi Aramco in talks with RIL for stake in refineries

New Delhi: Saudi Aramco, the world's largest oil exporter, is in talks to buy stake in Reliance Industries' oil refineries and petrochemical complex, sources privy to the development said.

Aramco opened talks with Reliance as $44-billion mega refinery-cum-petrochemical complex, where it was taking a 50 per cent stake along with UAE's ADNOC, got delayed after ruling BJP-government scrapped plans to acquiring land for the project in coastal Maharashtra.

The sources said talks have been going on for few months now but there is nothing concrete that has materialised just as yet. Reports suggested Aramco may take 25 per cent stake for $10-15 billion but sources discounted such a valuation saying market capitalisation of Reliance at Tuesday's closing price on BSE was over Rs 8.5 lakh crore, at least half of which or Rs 4.25 lakh crore (about $60 billion) would be coming from refinery and petrochemical business.

A 25 per cent stake would translate into $15 billion without even considering any premium of giving a firm a foothold into a well-established business in the world's third largest energy consuming nation, they said. Reliance declined to comment on the issue. "As a policy, we do not comment on media speculation and rumours. Our company evaluates various opportunities on an ongoing basis," a company spokesperson said.

"We have made and will continue to make necessary disclosures in compliance with our obligations under Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015 and our agreements with the stock exchanges". Aramco has on multiple occasions in the past disclosed its discussions with Reliance.

The last such comment was on February 20 when its CEO Amin Al-Nasser visited here as part of a high-level delegation visiting India along with Saudi Crown Prince Mohammed bin Salman. The discussions with Reliance first came to light in December when Saudi Oil Minister Khalid al-Falih visited Reliance owner and richest Indian Mukesh Ambani. Al-Falih, who has known Ambani for over a decade now, travelled to Udaipur that month to attend the pre-wedding festivities of Ambani's daughter Isha's marriage with Ajay Piramal's son Anand.

During the visit, he also held talks with Ambani and he later tweeted: "we discussed opportunities for joint investments and cooperation in petrochemical, refining and communications projects". In January, Aramco CEO met Ambani, possibly as a follow-up of that meeting. Reliance operates two refineries at Jamnagar with a total capacity of 68.2 million tonnes per annum.