RIL, Gail team up for Russian assets
Last year, RIL had bid for the Ras-Turana refinery and petrochemicals project in Saudi Arabia, but the project was finally bagged by Dow Chemicals.
By Piyush Pandey, TNN |
MUMBAI: Indian petrochemical major Reliance Industries (RIL) and state-owned Gail India are examining the feasibility of setting up petrochemical plants in Russia. Both companies had earlier signed an MoU to collaborate in downstream projects overseas.
Confirming this, Gail chairman UD Choubey told ET: "We are in talks with RIL to set up petrochemical projects overseas." But he declined to comment about the exact location of the project. “We are looking at various locations with feedstock availability and Russia could be one of them,” Mr Choubey added. RIL is learnt to be scouting for setting up petrochemical plants in Russia and Gulf countries for quite some time. A mail sent to RIL remained unanswered.
Last year, RIL had bid for the Ras-Turana refinery and petrochemicals project in Saudi Arabia, but the project was finally bagged by Dow Chemicals.
Peter Burnie, partner, tax and legal services, energy & resources at Deloitte in Russia said: “We had discussions with Indian firms and they are keen on investing in Russia’s oil and gas sector.”
India is a large importer of crude oil but exports refined products because of spare refining capacity. Russia is one of the largest exporters of crude oil but exports few refined products because of poor refining capacity. Indian firms have opportunity for setting up refineries and petrochemical projects in Russia and other CIS countries, he said.
However, oil industry sources say foreign companies investing in the Russian energy business have faced rough weather in recent years. Navigating the minefield of the local political system has not proved to be simple.
Deloitte representatives from Russia were in India to discuss business opportunities for international investments in Russia and the CIS. They made representations to RIL, Gail, ONGC to invest in the region.
“Transportation of crude oil and gas from Russia to India could be a problem because of infrastructure and geographical reasons. But setting up greenfield refining and petrochemical projects in Russia could be a good solution. This idea came from one of the leading Indian oil and gas firms,” said Yaroslav Gorodiskiy, director, financial advisory services, corporate finance advisory, Deloitte.
“An Indian firm may set up wholly-owned refining and petrochemical project in Russia. A company need not have a local partner to enter the oil business in Russia,” Mr Gorodiskiy added.
Indian firms interested in setting up downstream activities may sign a contract with Russian firm to source crude oil or gas as feedstock,” Mr Gorodiskiy added. With competition in the Indian pipeline industry with the entry of multiple players, Gail has increased investments in petrochemicals.
Confirming this, Gail chairman UD Choubey told ET: "We are in talks with RIL to set up petrochemical projects overseas." But he declined to comment about the exact location of the project. “We are looking at various locations with feedstock availability and Russia could be one of them,” Mr Choubey added. RIL is learnt to be scouting for setting up petrochemical plants in Russia and Gulf countries for quite some time. A mail sent to RIL remained unanswered.
Last year, RIL had bid for the Ras-Turana refinery and petrochemicals project in Saudi Arabia, but the project was finally bagged by Dow Chemicals.
Peter Burnie, partner, tax and legal services, energy & resources at Deloitte in Russia said: “We had discussions with Indian firms and they are keen on investing in Russia’s oil and gas sector.”
India is a large importer of crude oil but exports refined products because of spare refining capacity. Russia is one of the largest exporters of crude oil but exports few refined products because of poor refining capacity. Indian firms have opportunity for setting up refineries and petrochemical projects in Russia and other CIS countries, he said.
However, oil industry sources say foreign companies investing in the Russian energy business have faced rough weather in recent years. Navigating the minefield of the local political system has not proved to be simple.
ADVERTISEMENT
Deloitte representatives from Russia were in India to discuss business opportunities for international investments in Russia and the CIS. They made representations to RIL, Gail, ONGC to invest in the region.
“Transportation of crude oil and gas from Russia to India could be a problem because of infrastructure and geographical reasons. But setting up greenfield refining and petrochemical projects in Russia could be a good solution. This idea came from one of the leading Indian oil and gas firms,” said Yaroslav Gorodiskiy, director, financial advisory services, corporate finance advisory, Deloitte.
“An Indian firm may set up wholly-owned refining and petrochemical project in Russia. A company need not have a local partner to enter the oil business in Russia,” Mr Gorodiskiy added.
Indian firms interested in setting up downstream activities may sign a contract with Russian firm to source crude oil or gas as feedstock,” Mr Gorodiskiy added. With competition in the Indian pipeline industry with the entry of multiple players, Gail has increased investments in petrochemicals.
Start a SIP with as low as ₹500 with ET Money App!
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
