The much-awaited joint venture (JV) between Mukesh Ambani-led Reliance Industries (RIL) and BP Plc on retail service station network and aviation fuels business will be in place by the year-end, said Bob Dudley, group executive of the global oil and gas major, on Monday.
“We are very optimistic about the JV with RIL. We will work together to bring all kinds of new technologies. RIL is currently having 1,500 fuel stations and will soon be getting up to 5,000 across the country,” said Dudley, while addressing the media on the sidelines of CERA Week.
The JV will incorporate and build on RIL’s current fuel retailing network across India.
In the new JV, around 51 per cent will be held by RIL and 49 per cent by BP. It will also look into innovative models like mobile fueling units and home delivery. The two companies could also look at providing electric charging facility in some of their outlets. RIL’s aviation fuels business currently operates at more than 30 airports across India.
RIL and BP have a tie-up in exploration and production sector for almost a decade now. Since 2011, the two have invested more than $2 billion in deep-water exploration and production to date.
Dudley batted for a scenario where arms length pricing should be in place with proper trading platforms and producers can sell gas in open market, if required to their own companies. “We are happy with the new natural gas pricing formula. I would, however, like to see a system where all customers can bid for gas and we can sell it,” Dudley said.
BP and its partner have said around $5 billion in KG basin field will be on stream by May 2020. Betting big on the potential of East Coast region, he added: “Look at East Coast, seismic trend looks like a lot of natural gas. Deepwater gas exploration is, however, expensive.”
Dudley hinted that once pipelines are in place and utilised, these deepwater gas will become more viable. Addressing the meet, he said nearly 100 trillion cubic feet of natural gas resources were yet to be found in India and this could meet around half of the country's demand by 2050.
He said the current liquefied natural gas spot prices of around $4 million metric British thermal unit (mmbtu) was low. “I would call it distressed cargo. If we are developing gas domestically, it has to be economical too,” he said.
On the upcoming privatisation process of BPCL, he said BP would examine what’s on offer. “Privatisation is very exciting, seems BPCL will be the largest one in India’s history,” he said.