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Monday
Feb212011

BP Partners with Indian Company Reliance for Oil, Gas Stakes

Photo Courtesy - Jim Watson/AFP/ Getty Images(LONDON) -- BP announced Monday it will partner with India's largest private sector company, Reliance Industries Limited, taking a 30 percent stake in 23 oil and gas production contracts operated by Reliance.

BP will intially pay Reliance $7.2 billion for the stake, and could later pay the Indian-based company payments of $1.8 billion based on the development of commercial discoveries that result from successful exploration.  All combined, the payments could amount to $20 billion.

The partnership will form a 50/50 joint venture between both companies for the sourcing and marketing of gas in India and will try to speed up the creation of infrastructure for receiving, transporting, and marketing the fuel source in the country.

Mukesh Ambani, the chairman and managing director of Reliance Industries Limited, said, "We are delighted to partner with BP, one of the largest energy majors and one of the finest deep water exploration companies in the world.  This partnership combines the skills of both companies and will be focused on finding more hydrocarbons in the deep water blocks of India and significantly contribute to India's energy security."

Copyright 2011 ABC News Radio

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