Reliance unveils details of oil-to-chemical business spinoff plan
NEW DELHI: Reliance unveils details of oil-to-chemical business spinoff plan – The upcoming business unit will hold its petroleum refinery and petrochemical assets of Reliance Industries Ltd’s new oil-to-chemical and retail fuel business but not upstream oil and gas producing fields like KG-D6 and textiles business, the firm said detailing hiving-off plans.
RIL has started work on hiving off the oil-to-chemical (O2C) business into a separate unit for a possible stake sale to companies like Saudi Aramco.
Reliance O2C Ltd will house oil refining and petrochemical plants and manufacturing assets, bulk and wholesale fuel marketing, and RIL’s 51% interest in retail fuel venture with BP of the united kingdom , consistent with the Scheme of Arrangement.
The O2C unit would also house RIL’s Singapore and therefore the UK-based oil trading subsidiaries and marketing subsidiary, Reliance Industries Uruguay Petroquimica SA.
It would also house Reliance Ethane Pipeline Ltd that operates a pipeline between Dahej in Gujarat and Nagothane in Maharashtra also as 74.9% stake that RIL holds within the venture with Sibur.
To transports coal-bed methane from its CBM blocks, overseas oil and gas asset company Reliance Industries (Middle East) DMCC, RIL’s very large ethane carriers, gas pipelines like and domestic exploration and production assets wouldn’t form a part of the O2C unit, it said.
Within Baroda township and land, including cricket stadium, Jamnagar power assets, RIL’s textiles business as operated out of the Naroda site, and Sikka Ports and Terminals Ltd would also not be a part of the O2C unit.
RIL values the O2C business at $75 billion and has been in talks with Saudi Oil Co (Aramco) purchasable of a 20% interest.
“The nature of risk and returns involved within the O2C business are distinct from those of the opposite businesses of RIL and therefore the O2C business attracts a definite set of investors and strategic partners,” the corporate said detailing the rationale for hiving off the companies .
RIL said it’s been exploring various opportunities to usher in strategic/other investors within the O2C business.
At the firm’s annual general meeting in July, the richest Indian and RIL chairman and director , Mukesh Ambani had stated that the method of spinning of O2C into a separate subsidiary would be completed by early 2021.
RIL owns and operates twin oil refineries at Jamnagar in Gujarat, with a combined capacity of 68.2 million tonnes once a year .
Read more Corporate News on India Frontline.