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BP forms Indian fuels partnership with Reliance Industries

August 09/2019

MOSCOW (MRC) -- BP and Mukesh Ambani’s Reliance Industries have agreed to form a fuels joint venture in India as the UK oil and gas major seeks expansion in the fastest-growing energy consumer, said the Financial Times.

Building on an offshore gas exploration and production partnership which began in 2011, BP and Reliance will jointly form a petrol station network and aviation fuels business. Foreign companies, from BP to Saudi Aramco, are trying to secure a foothold the Indian market as they bank on the country’s rising oil demand in the years to come.

The companies did not disclose financial details but the deal would see BP take a big stake in Reliance’s retail and aviation fuels business. The new joint venture would be 49 per cent owned by BP and 51 per cent by Reliance. The deal is expected to formally close in the first half of 2020.

BP will help nearly quadruple Reliance’s retail fuels sites to 5,500 and will gain access to the company’s aviation fuels business, which currently operates at over 30 airports across India.

Government figures show well over 230m vehicles clog up India’s roads, up threefold since 2001, but this is seen as a hugely under-developed market. A boom in fuel retail networks is expected with a greater role for the private sector, which is trying to stake its claim over the Indian energy sector.

Rapid fossil fuel demand growth in India is set to support the global energy industry at a time consumption is set to stagnate in the west. A shift towards Asia also comes at a time when western public sentiment against oil and gas companies is rising for their role in enabling climate change.

Bob Dudley, chief executive of BP and Mukesh Ambani, chairman and managing director of Reliance Industries, signed a preliminary agreement in Mumbai on Tuesday. Mr Dudley said: “India is set to be the world’s largest growth market for energy by the mid-2020s."

Mr Ambani said the deal would enable Reliance to “deepen our engagement” with consumers. BP also hopes to deliver mobility services, such as electric vehicle charging, in certain markets.

The Reliance announcement comes a week after BP said it would build an electric vehicle charging network in China with Didi Chuxing, the ride-hailing group.
Author:Anna Larionova
Tags:petroleum products, petrochemistry, Crude oil, British petroleum.
Category:General News
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