Mumbai: A top official from Reliance Industries Ltd (RIL), which owns the world’s third biggest refinery, said the company may make a “world-scale” acquisition in the energy sector for up to $15 billion (Rs59,100 crore) after years of strong and robust organic growth.
“We would be looking at major acquisitions, there is no question, because our growth cannot come only in the organic,” said Atul Chandra, RIL’s president for the international oil business, at the Reuters India Investment Summit.
“We are always looking at opportunities where we find hidden value. If we do something, it will be world scale. It will be a major acquisition no matter what we do. Such acquisitions could be in excess of $10 billion to $15 billion.”
He didn’t specify if RIL would be more likely to buy into upstream exploration or production assets, or to expand its core downstream refining and petrochemical activities.
RIL, which has a market capitalization of more than $100 billion, hopes eventually to produce some 300,000 barrels per day (bpd) of oil overseas, although its current focus is primarily on exploration, added Chandra, who led the overseas expansion of state-owned Oil and Natural Gas Corp. Videsh Ltd in the 1990s.
“You can have the luxury of consolidation when you have something in hand,” Chandra said. “What happens is that when you start collecting exploration acreages, after a while when you have a portfolio, then we start swapping and consolidating.”
RIL is actively pursuing exploration in West Asia, Asia-Pacific and South America. In November, it signed contracts with Iraq’s Kurd-istan regional government for two onshore blocks, Rovi and Sarta.
The company runs a 660,000 bpd export-oriented refinery in western India, and its subsidiary Reliance Petroleum Ltd is building an adjacent plant that will lift joint capacity to more than 1.2 million bpd. Reuters