Reliance sells 30% stake in 23 PSCs off India to BP

By OGJ editors
HOUSTON, Feb. 21--Reliance Industries Ltd. announced it was selling a 30% stake in 23 oil and natural gas production sharing contracts to BP PLC for $7.2 billion along with future performance payments of up to $1.8 billion depending upon development of commercial discoveries.

These payments and combined investment could reach $20 billion, BP said in a news release. BP and Reliance also are forming a 50:50 gas marketing joint venture in India. The joint venture is expected to accelerate the creation of infrastructure for receiving, transporting, and marketing gas.

The 23 oil and gas blocks, including the producing KG D6 block, together cover 270,000 sq km. Reliance will continue to operate these blocks, which are in 400-3,000 m of water. The blocks produce about 1.8 bcfd.

The companies said the transaction was one of the largest foreign direct investments into India.