Mumbai: Energy major Reliance Industries plans an aggressive exploration campaign, investments in petrochemicals and overseas acquisitions as India’s top company prepares itself for the next phase of growth.
The company will work towards attaining global scale for its conventional energy platform -- petrochemicals, refining and oil and gas exploration -- and invest in its new businesses such as retailing and alternative energy, chairman Mukesh Ambani said at the company’s annual meeting of shareholders.
“The business transformation initiative would create a Reliance that is able to scale up existing businesses; adds new business both organically and inorganically,” said Ambani, who is India’s richest man.
At 12.50 pm, the shares were down 1.1% at Rs2,125 in the Mumbai market that was down 0.1%.
Reliance, founded by Ambani’s father Dhirubhai, a school teacher’s son, has grown rapidly as it diversified from making textiles to polyester to refining to oil and gas exploration, but a sluggish global economy seen its profit fall in the past for four quarters.
A high-profile legal battle over a deal to sell gas to Reliance Natural Resources, led by Mukesh’s estranged younger brother Anil, at below the price set by the government, has also unnerved investors.
Ambani did not mention the gas dispute in his speech.
He said while the global financial crisis had fundamentally changed the world of business, Reliance expected it would have both strong growth and a larger global footprint.
“Exploration and production business would give the company a much higher growth trajectory in the coming years,” Ambani said.
In April, Reliance began pumping gas from its find in the Krishna Godavari basin off India’s east coast, which is expected to almost double the country’s gas supplies at peak production.
Gas production has crossed 6 billion cubic metres and the field is slated to plateau production by the second half of 2010. Oil production has reached 2.8 million barrels with daily peak production expected by the end of the year, Ambani said.
This production is from just three of the 19 discoveries in the area, he said.
The company also plans to set up a petrochemical complex at Jamnagar in Gujarat that would nearly double its current capacity to 4 million tonnes a year.
“Now that the oil and gas petroleum refining projects are commissioned, Reliance will work on making this world-class project a reality.”
It already has the single largest refining complex in world at Jamnagar, with a capacity to process 1.24 million barrels per day.