Aramco was the world’s largest crude exporter and also the major supplier of crude to India. Aramco creates a long term crude supply contract of 0.5 million barrels per day to RIL’s Jamnagar refinery, with fewer demand risks. The world’s largest oil exporter Saudi Aramco is going to buying a $15 billion stake in reliance industries Ltd’s refining and petrochemicals business, Amin Nasser, CEO said. Mukesh Ambani announced that he plans to sell 20 percent of Aramco stake in RIL’s oil to chemical business, which cost $75 billion. It has been delayed because the deal was too closed by March 2020.
Nasser adding that connecting with Reliance deal, at the current scenario it’s going through the due diligence. So depending on the due diligence, this will decide after they complete the due diligence on the deal. They need more time to take a review and decide based on the result of the due diligence study because their big deal is to buy a stake in the world’s largest single-location oil refining complex and India’s biggest petrochemical assets.
In the annual general meeting Ambani stated that by last month the Aramco deal had been delayed because of some uncertain circumstance in the energy market and also by considering COVID 19 situation. He neither mentions that if the deal was on track or gave new timelines for its completion. Nasser also not added about the timelines for completion of the deal. He never updated the discussions and shareholders in due course also.
RIL’s O2C business connects the company’s twin refineries at Jamnagar in Gujarat, petrochemicals plants, and also the 51 percent in fuel. Aramco itself makes the world’s largest crude exporter join the ranks of the top refineries and it helps to attain the goal of more than doubling refining capacity to between 8 to 10 million per day in barrels.
The strategic partnership presently stands at 20 percent, which will help in increasing crude oil to chemicals conversion ratio with Aramco. RIL will get technological expertise from SABIC (Saudi Basic Industries Corporation) If the deal undergoes and Aramco has recently purchased a controlling stake in it.
At present Aramco has a long-term deal with RIL with reduced demand risks in which it supplies 0.5 million barrels per day that is about 5 percent of its current production. These are supplied to RIL’s Jamnagar refinery. Aramco currently covers only about 40 percent of its crude output reefing and it strikes to improve further. The partnership itself makes a big deal to Aramco Company to achieve its strategic goals.
