New Delhi: Reliance Industries and UK's BP plc have agreed to form a new joint venture to set up petrol pumps and retail aviation turbine fuel to airlines in India, the two companies said on Tuesday.
Reliance's existing 1,400-odd petrol pumps, as well as 31 aviation fuel stations, will be transferred to the new joint venture where BP will hold 49 per cent equity stake. Reliance will hold the balance 51 per cent in the entity, which aims to expand the retail network to 5,500 petrol pumps in the next five years, the two firms said in a joint statement.
It, however, did not say if BP will pay Reliance any money for getting near half ownership of the 1,400-odd petrol pumps and jet fuel retailing facilities at 30 airports.
The two firms signed heads of agreement on Tuesday and hope to finalise a sales purchase agreement, which will entail investments, in next few months, an official said.
The agreement with BP comes amidst talks Reliance is holding with Saudi Aramco for a possible sale of a stake in the twin oil refineries at Jamnagar in Gujarat. Saudi Aramco, which is said to be keen to buy a quarter of 68.2 million tonnes refineries of Reliance, is also looking to venture into fuel retailing in India to tap the world's fastest-growing energy consumer.
This is the third joint venture between Reliance and BP since 2011.
BP had in 2011 bought 30 per cent stake in 21 oil and gas exploration and production blocks of Reliance for $7.2 billion. At that time, another 50:50 joint venture, India Gas Solutions Pvt Ltd, was set up for sourcing and marketing gas in India.
While Reliance-BP has relinquished all but a couple of oil and gas blocks over these years, IGSPL is at a nascent stage.
BP and Reliance in the statement said: "They have agreed to form a new joint venture that will include a retail service station network and aviation fuels business across India".