Kuwait Petro in JV talks with Reliance Industries

Kuwait Petro in JV talks with Reliance Industries
6 Dec, 2007, 0224 hrs IST,Rajeev Jayaswal & Soma Banerjee, TNN
NEW DELHI: Kuwait Petroleum (KPC) and Reliance Industries (RIL) have kicked off the first round of discussions for scripting a mega joint collaboration across the oil and gas vertical. KPC, the national oil major of Kuwait, is keen to rope in RIL as a partner in its upcoming projects in Kuwait in both refining and petrochemicals.

The KPC top brass, led by its vice-chairman & CEO Sa’ad Al-Shuwaib, is currently on an India tour. They were in the RIL headquarters on Wednesday to discuss the possibilities of such a collaboration. The visiting team will be holding talks with petroleum minister Murli Deora and senior petroleum ministry officials on Thursday.

Sources said KPC has concluded an agreement with Dow Chemicals by which it plans to jointly take up projects in Kuwait and third countries. Kuwait, which commands about 10% of the world’s oil reserves is building its downstream capacities including refineries and petrochemical plants to capitalise on its oil assets.

Collaborations with global majors who have expertise in downstream sectors is thus a part of the country’s strategy. A possible venture with RIL on the lines of the Dow Chemicals collaboration will make a strategic fit.

Although, at this point, the talks between RIL and KPC are at a nascent stage, the two oil majors are planning to explore possibilities of investments particularly in Kuwait’s refining and petrochem business. Possibilities of joint investments in third world countries too have not been ruled out. The two companies have decided to set up working groups to explore synergy areas and possible ventures where RIL can come in.

A source in the know said KPC was particularly “impressed with the on-going projects of RIL, particularly in the refinery sector and said that KPC would be keen to look at some sort of cooperation and presence in the new refinery being planned by Reliance. KPC will look at this cooperation in conjunction with Dow Chemicals which has an extensive exposure in Kuwait.”

Mr Al-Shuwaib is also expected to meet GAIL chief executive in Delhi. He is meeting petroleum minister Murli Deora in the capital on Thursday. Before becoming the CEO of KPC, Mr Al Shuwaib was the chairman & managing director of Petrochemicals Industries (PIC), a subsidiary of KPC. Recently PIC has moved towards production of high-value petrochemicals.