Mumbai: Reliance Industries Ltd (RIL) said it has agreed to sell its entire 70% stake Gujarat’s Cambay Basin block to Dilip Shanghvi-promoted Sun Petrochemicals Pvt. Ltd (Sun Oil and Natural Gas) for an undisclosed amount. Reliance has a 70% participating interest in the oil and gas block CB-ONN-2003/1 (also called CB-10) while BP India holds the balance 30%.
“RIL signed a sale and purchase agreement (SPA) with Sun Petro to farm out its 70% interest in the block. The application for assignment has been submitted to the Government of India for approval," RIL said in a presentation to analysts on Friday. Mint had in March reported that RIL along with BP had put up their Cambay block for sale.
RIL is the operator of the block, which covers 635 sq. km and is divided into two parts, A and B. It had won the block in 2005 in an auction in New Exploration and Licensing Policy (NELP).
With the sale of CB-10, RIL now holds only four blocks—KG-D6 block in the Krishna Godavari basin; Mahanadi basin blocks NEC-25 and GS-01 in Saurashtra basin; and Panna-Mukta-Tapti oil and gas fields in the Arabian Sea. RIL will shut down the MA oil and gas field in KG-D6 from September.
In 2011, RIL had announced a “transformational" deal with UK-based BP Plc, which picked up 30% stake in its 21 oil and gas blocks. However, since 2012, both companies have been pruning their portfolio, relinquishing unviable blocks.
RIL has also sold all its 16 overseas conventional oil and gas exploration blocks that it acquired in the past. In its international portfolio, RIL now holds two shale gas assets in the US. In October 2017, it agreed to sell the first of its shale gas ventures—upstream Marcellus shale gas assets in North-Eastern and central Pennsylvania in the US—for $126 million.
The company is also looking at merging Reliance Holdings USA with itself. Last month, RIL had submitted an application to the Reserve Bank of India, in terms of Foreign Exchange Management (Cross Border Merger) Regulations, 2018, seeking its approval for amalgamation of Reliance Holdings USA Inc, with Reliance Energy Generation and Distribution Ltd (REGDL), a wholly owned subsidiary of the company and subsequent amalgamation of REGDL.
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On Friday, RIL officials said the merger would help the company look at pooling its international gas resources for India, similar to its ethane imports.
Between 2010 and 2013, RIL bought stakes in three upstream oil exploration joint ventures with Chevron, Pioneer Natural Resources and Carrizo Oil and Gas; and a midstream joint venture with Pioneer. Midstream refers to the processing, storing, transporting and marketing of hydrocarbons.
This March, RIL through its subsidiaries Reliance Eagleford Upstream Holding LP and Reliance Holding USA, agreed to sell part of its interest in Eagle Ford shale assets to Sundance Energy Inc. for $100 million.