BP and Reliance Industries Announce Partnership in India
OREANDA-NEWS. February 24, 2011. Reliance Industries Limited and BP announced a historic partnership between the two companies. Mr. Mukesh Ambani, Chairman and Managing Director of Reliance Industries Limited, and Mr. Robert Dudley, BP Group Chief Executive, signed the relationship framework and transactional agreements in
The partnership across the full value chain comprises BP taking a 30 per cent stake in 23 oil and gas production sharing contracts that Reliance operates in
The partnership will combine BP's world-class deepwater exploration and development capabilities with Reliance's project management and operations expertise.
Mukesh Ambani said: "We are delighted to partner with BP, one of the largest energy majors and one of the finest deep water exploration companies in the world. This partnership combines the skills of both companies and will be focused on finding more hydrocarbons in the deep water blocks of
For BP, Reliance is a natural partner in
"This partnership meets BP's strategy of forming alliances with strong national partners, taking material positions in significant hydrocarbon basins and increasing our exposure to growing energy markets," said Mr. Carl-Henric Svanberg, Chairman of BP.
BP will pay Reliance Industries Limited an aggregate consideration of USD 7.2 billion, and completion adjustments, for the interests to be acquired in the 23 production sharing contracts. Future performance payments of up to USD 1.8 billion could be paid based on exploration success that results in development of commercial discoveries. These payments and combined investment could amount to USD 20 billion.
BP's confidence in
The 23 oil and gas blocks together cover approximately 270,000 square kilometres. This will make the partnership
So that the joint venture can capitalise on Reliance's outstanding project management track record and operations expertise, Reliance will continue to be the operator under the production sharing contracts, whose blocks lie in water depths ranging from 400 to over
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Completion of the transactions is subject to Indian regulatory approvals and other customary conditions.
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