Indian government approves BP-RIL deal

By OGJ editors
HOUSTON, July 22 -- The offer by a BP PLC subsidiary to acquire a 30% interest in most of Reliance Industries Ltd.’s (RIL) exploration and production blocks in India has received approval, with modifications, of the Indian government, according to press reports.

The Cabinet Committee on Economic Affairs approved acquisition by BP Exploration (Alpha) Ltd. of the interest in 21 of 23 blocks involved in the $7.2 billion offer. The exploration status on the other two blocks is under dispute.

The approved blocks include acreage covering RIL’s deepwater gas discoveries on Block D6 in the Krishna-Godavari basin.

BP and RIL agreed in February to form a joint venture based on the deal, with RIL remaining operator of the blocks. Future payments of $1.8 billion are possible (OGJ Online, Feb. 21, 2011).