The logo of Saudi Aramco is seen at the 20th Middle East Oil & Gas Show and Conference in Manama, Bahrain. PHOTO: REUTERS/Hamad I Mohammed
The logo of Saudi Aramco is seen at the 20th Middle East Oil & Gas Show and Conference in Manama, Bahrain. PHOTO: REUTERS/Hamad I Mohammed

Dubai/New Delhi — State oil giant Saudi Aramco, the world’s biggest oil producer, is in talks to buy a minority stake in the refining and petrochemicals businesses of India’s Reliance Industries, sources familiar with the matter said on Wednesday.

The Times of India reported earlier that Aramco was in talks to buy a stake of up to 25%, which could be worth about $10bn-$15bn, valuing the Indian company’s refining and petrochemicals businesses at about $55bn-$60bn.

Aramco’s discussions with Reliance were serious, one source said. Another source said talks with Reliance were so far for a 25% stake.

“Reliance has offered an integrated deal, a stake in existing refineries and the planned 600,000-barrels-per-day [Jamnagar] refinery, along with the petrochemical business,” the second source said.

Aramco CEO Amin Nasser said in February the Saudi company was in talks on possible investments in Indian projects involving firms that included Reliance.

Aramco and Reliance declined to comment on Wednesday.

Reliance, controlled by Asia’s richest man, Mukesh Ambani, is India’s biggest refining and petrochemicals company and runs a 1.4-million-barrels-per-day (bpd) refining complex at Jamnagar in western India. It plans to expand capacity to 2-million bpd by 2030, according to plans shared with the Indian government.

Aramco is expanding its refining and petrochemical business globally by signing new deals and boosting the capacity of its existing plants.

In 2018, Aramco and the United Arab Emirates’ Abu Dhabi National Oil Company teamed up with state-run Indian refiners in a plan to build a 1.2-million bpd refinery and petrochemical project in Maharashtra state.

However, the planned refinery faces delays as thousands of farmers have refused to surrender land for it and the Maharashtra government is looking to move the plant’s location.

Saudi Crown Prince Mohammed bin Salman visited India in February and said then that he expected investment opportunities worth more than $100bn there over the next two years.

Ambani has travelled to Saudi Arabia at least twice since December 2018, discussing joint investment among other issues with Nasser.

Reuters