In one of the biggest foreign collaborations in the country's refinery sector, Reliance Industries along with US oil major Chevron on Wednesday announced signing of an agreement for purchase of 5 per cent equity of Reliance Petroleum Ltd for $300 million (about Rs 1350 crore).
The purchase, subject to approvals from the regulatory authorities, would be made by Chevron India Holdings Pte Ltd Singapore, a wholly-owned subsidiary of Chevron Corporation, RIL informed the Bombay Stock Exchange on Wednesday.
The agreement provides Chevron with the right to acquire an additional 24 per cent of the equity stake in RPL.
Besides, RIL has also signed two MoUs with Chevron. The first MoU sets out the principles of partnership by which the company and Chevron plan to optimise the crude supply and product offtake and marketing of the RPL refinery, it said.
Under this MoU, RIL and Chevron would jointly evaluate application of mutually selected refinery technology. While the second MoU envisages cooperation between the two to set up a technology development centre in the country.
"The agreement and MoUs between Chevron and Reliance will be the first step in establishing a strong partnership with one of the world's largest and most respected companies," Mukesh Ambani, RIL chairman and MD said.
Chevron has recognised the inherent strengths of India in energy sector, he said. The deal, post acquisition, would be one of the largest investments from an MNC in a single project in the country.
The decision of Chevron to acquire an equity stake in an upcoming refinery project is a reaffirmation of the company's strengths in project execution and commissioning coupled with company's talented human resource base, it said.
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