RIL seperates overseas oil & gas projects
March 9, Reliance Industries‘ oil and gas projects were removed from the original company to form its wholly owned subsidiary named Reliance Exploration and Production DMCC. Reliance Exploration and Production DMCC has been formed with Mukesh Ambani as its chairman. This eyes a tie-up with OVL to jointly bid for oil and gas opportunities abroad.
Dubai-based full owned overseas investment subsidiary of state run Oil and Natural Gas Corporation has been modelled in lines of ONGC Videsh Ltd. Reliance Industries discovered oil block in Yemen and in an offshore exploration block in Oman, besides exploration projects in northern Iraq, East Timor and Columbia will be transferred to the new company.
The sources said that Reliance Industries Ltd. had realised that it needed to delink assets in politically risk prone areas from its balance sheet. They said that it made business sense because every time they brought home seismic data of any overseas assets for processing, they paid 12 percent customs duty.
The sources said Reliance Industries Ltd. was keened in bidding together for major opportunities with OVL, which had presence in 15 countries. Reliance Industries Ltd. was a conservative player and would rather like to share risks with OVL, they added.
The company is looking at opportunities in Africa, Latin America and West Asia. RIL has also signed agreements with the Columbian hydrocarbon regulator, ANH and Ecopetrol for farm in opportunities in Columbia.
