The Hindu Business Line : GAIL, Reliance looking at joint projects in Qatar, Russia

Looking ahead
The joint working group, set up by both companies, will submit its report in April on the project feasibility.
After identifying the projects, GAIL and RIL will set up a special purpose vehicle for setting up petrochemical complexes abroad.
GAIL is also looking for an Indian partner for its likely project with Russia’s Lukoil.

Richa Mishra

New Delhi, March 13 GAIL (India) Ltd and Reliance Industries Ltd (RIL) are examining prospects of joint petrochemicals projects in Qatar and Russia. A senior GAIL official told Business Line that a joint working group, set up by the two companies, is likely to submit its report in April on the feasibility of the projects.

Out of 11 countries where such opportunities were conceptualised, the working group has narrowed down two-three countries, he said. The 11 countries which the task force has been looking at include Saudi Arabia, Algeria, Nigeria, United Arab Emirates and CIS countries. “We would be looking at countries where gas is available,” he said.

Both GAIL and Reliance have been evincing keen interest in setting up petrochemical projects overseas.

Identifying opportunities

Last year, the public sector gas transmission and marketing major and the private sector company had inked a memorandum of understanding (MoU) for joint cooperation in petrochemicals. Under the MoU, GAIL and RIL would explore opportunities for setting up petrochemical complexes overseas in feedstock rich countries. As per the agreement, identified opportunities will be examined by a working group, consisting of representatives from both the companies.

Subsequent to identifying the projects, GAIL and RIL will set up a special purpose vehicle (SPV) for setting up petrochemical complexes abroad.

In addition, the two companies will also examine the possibilities of mutual cooperation in the domestic market.

Lukoil project

Meanwhile, GAIL is also looking for another Indian company as partner for its likely business venture with Russian oil firm Lukoil. GAIL has been in talks with Lukoil for building a petrochemical plant and liquefied natural gas (LNG) terminal in Saudi Arabia.

Besides acquiring stake, GAIL has also proposed to jointly set up an LNG terminal and a petrochemical plant in Saudi Arabia along with Lukoil and an Indian partner. Lukoil has 80 per cent stake in the block, while the remaining is with Saudi Aramco. Lukoil has two blocks in Saudi Arabia.

GAIL and Lukoil have formed a joint working group for the purpose. The working group would not only be examining the prospects of the petrochemical and LNG project in Saudi Arabia, but also the possibility of a tie-up in other activities in the hydrocarbon sector.

Besides Lukoil, GAIL is also in talks with Qatar’s state-owned Qatar Petroleum to build a petrochemical plant in that country.