Reliance, Essar race to Russia for oil and gas

MUMBAI: Two of India’s leading private sector oil majors Reliance Industries (RIL) and the Essar group are exploring possibilities of entering Russia, one of the largest oil and gas producers in the world.

Both companies have proposed to the Russian government to invest in oil and gas exploration projects in the joint sector for tapping large reserves of oil and gas in Russia.“Both Reliance and Essar have shown keen interest to enter the Russian oil market.

The Russian government is considering these cases positively,” Russian Ambassador in India Vyacheslav I Trubnikov said. Both RIL and Essar spokespersons declined to comment on the development.

Sources said that Reliance Industries chairman Mukesh Ambani, during his last visit to St. Petersburg had proposed to set up joint sector projects in Russia with the Russian government’s co-operation. Senior Essar group officials have also recently visited Russia to study the oil and exploration market in the country.

Essar has already a joint venture with Russian oil company with Stroy TransGaz for developing oil and gas pipelines. Russia is chairing G8, which will take place on July 17 in Russia. Russian President Vladimir Putin recently said that energy security is the summit’s chief concern.

Russia is currently encouraging investments in its oil and gas sector. Chevron Corp, based in San Ramon, and Houston-based ConocoPhillips are among the five companies being considered by Gazprom for a role in the Russia’s $20 billion Shtokman project, which plans to start supplying LNG to North America by 2011.

Vyacheslav I Trubnikov said that joint sector projects with Indian public sector majors like ONGC Videsh and Indian Oil are on anvil such as Sakhalin-1 oil project and Russian-Indian consortium to explore and produce hydrocarbons in the Bay of Bengal.