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Ratnagiri Refinery & Petrochemicals Ltd (RRPCL), the entity that plans to build the world’s plant in Maharashtra, will source 30 million tonnes (mt) or half of the crude it requires, from partners Saudi Arabian Oil Co (Saudi Aramco) and Abu Dhabi National Oil Company (ADNOC), a top official said.
Saudi Aramco, the world’s largest oil producer, and ADNOC, both state-owned, will together hold a 50 per cent stake in the ₹3-lakh crore project.
Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation, which together hold the balance 50 per cent stake in the 60-mt-a-year project, will also have the right of first refusal on Saudi Aramco and ADNOC’s share of products coming out of the refinery if the two decide against retailing it in India on their own and sell to customers in India or overseas, the official at one of the state-run refiners, briefed on the plan, said asking not to be named because the information is private.
“We have a commitment that we will source a maximum of 50 per cent from these two parties, but all this is subject to the grade fitting into the overall refinery configuration. The advantage with Saudi Aramco is that they have Arab Super Light to Arab Heavy and they are willing to make available anything in this range depending on the refinery configuration we chose,” he said.
“We are talking about importing 30 mt of crude from somebody; rest of the 30 mt is still open. This big 30 mt... every month if you try to buy 1-2 mt of crude... how it is going to happen?”
“We will decide the ratio amongst ourselves. Only then can they consider selling the products to someone else locally or taking the products out of India. Basically, we are building this refinery for India and Indians. They probably want to give us their share of the products because their initial view is not to get into retailing of products in India, maybe petrochemicals because of SABIC (Saudi Basic Industries Corp).
“They are trying to get SABIC into the fold so that markets like India and China can be an integrated market for them,” the official, who is a director at one of the oil marketing companies, said.
Saudi Aramco is separately looking to buy a controlling stake in SABIC, one of the world’s top petrochemicals manufacturers, owned by the Saudi Arabian government.
“No Middle East company is going to participate in refinery projects without having an engagement with crude. On the other hand, if you want to make big investments today you also need to have suppliers of crude who will give you a constant source of supply of the crude you want.
“So, if you really look at it long-term for such project of large investments, nothing is going to happen unless we have the crude supply tied-up and the product market. You know the India story, we have a big product market,” he stated.
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