Saudi Aramco is considering proposals to buy stakes in Indian oil refining and petrochemical projects, India's Oil Minister Dharmendra Pradhan said on Monday, as the world's biggest oil exporter seeks outlets for its oil.
India, the world's third-biggest oil consumer, imports almost 80 percent of its crude requirements, mostly from Middle Eastnations. In the first quarter, Saudi Arabia was India's biggest exporter of oil, sending about 889,000 barrel per day (bpd) to the country, or about 21 percent of the total.
Pradhan earlier this month met with Saudi Aramco chairman Khalid al-Falih and sought Saudi investment in a planned 1.2 million bpd refinery on India's west coast, the expansion of the Bina refinery and a petrochemical plant at Dahej, he said today.
"All the three we have offered to Saudi. The two sides will decide on the proposals in a time bound manner," Pradhan said, meaning there are deadlines for reaching investment decisions. Saudi Aramco did not respond to an email from the source seeking comments.
Three Indian state refiners - Indian Oil Corp, Hindustan Petroleum Corp and Bharat Petroleum Corp - plan to build the 1.2-million bpd refinery on the country's west coast at a cost of more than 1 trillion rupees ($15.02 billion) to meet the country's growing fuel demand.
Bharat Oman Refineries Ltd is expanding the capacity of the Bina refinery in Central India by 30 percent to 156,000 bpd while OPAL, majority owned by Oil and Natural Gas Ltd, is building a petrochemical plant in Western Gujarat state.
Saudi Aramco Chief Executive Amin Nasser last month said his company will is looking to expand its downstream investments in China, Malaysia, India, Vietnam and Indonesia.
Saudi Aramco's expansion into refineries in major markets help guarantee demand for its crude oil exports amid intensifying global competition.
India will be the most important driver of world energy demand growth in the years to come with its oil consumption rising by 6 million bpd to about 10 million bpd by 2040, according to the International Energy Agency.
In the fiscal year to March 2016, the country's fuel demand surged at its highest pace in at least 15 years.