Reliance said to expand world’s largest oil refining complex

Vehicles travel on the Western Express Highway

Vehicles travel on the Western Express Highway as a train travels across the cable-stayed Metro Bridge on Line 1 in Mumbai. Reliance is looking to cement its dominance in the world’s fastest-growing major oil consuming nation

Billionaire Mukesh Ambani-owned Reliance Industries Ltd is considering a plan to boost its oil-refining capacity by about half, people with knowledge of the matter said. The proposed plant, to come up at the world’s biggest refining complex in Jamnagar, will be able to process as much as 30mn tonnes of crude a year, the people said asking not to be identified because the discussions are private.  Asia’s richest man seeks to cement Reliance’s dominance in the world’s fastest-growing major oil consuming nation as rivals including Saudi Aramco, Abu Dhabi National Oil Co, and Russia’s Rosneft PJSC acquire plants in India. Total SA and Royal Dutch Shell are also expanding into fuel retailing in India. International Energy Agency expects India’s energy demand to more than double by 2040, making it the single largest source of global growth.

Reliance has begun discussions with global refinery process licencors and equipment vendors for the new refining train at the Jamnagar complex, the people said. The plant of the size planned by the company may cost $10bn, they said. A Reliance spokesman didn’t reply to an email seeking comment.Saudi Aramco and ADNOC signed agreements to invest in a proposed 60mn tonne refinery complex on India’s west coast while Rosneft and partners acquired the country’s second-largest private oil processor.Shell has restarted retailing gasoline and diesel in the country, while Total partnered the Adani Group to set up liquefied natural gas import terminals and fuel retailing business. Last year, BP Plc expanded its partnership with Reliance to retail auto fuels.

Demand for fuel in India and the Middle East will make the two regions bigger oil consumers than the European Union by 2030, driven mainly by diesel for trucks and petrochemicals feedstock, according to the IEA.
Reliance is looking to process the dirtiest and heaviest crude and may focus on producing feedstock for petrochemicals, the people said. The expansion plan is still under discussion and hasn’t been finalised, the people said. A feasibility report is likely to be prepared by the end of next year, once the recently-expanded petrochemicals capacities stabilise, and Reliance is expected to make the final investment decision with an aim to start work in 2020, the people said.

Sources and photo-credits: Gulf Times, Bloomberg