If all goes well BP(British Petroleum)-Reliance deal could turn out to be the biggest FDI investment in India.Estimated at $7.2Billion currently,if all other factors for the deal are taken into account the deal is valued at around $20billion surpassing Posco's $12 billion FDI deal.
BP has agreed to buy 30% stake in 23 oil and gas exploration blocks of Reliance for about $7.2billion to explore for deepwater oil and gas.BP would also pay an additional $1.8billion to Reliance if any commercially viable exploration or findings are achieved after the tie up.
This is the second major deal signed by BP under its new CEO Bob Dudley.Previous one was agreement of joint exploration of oil and gas in the Arctic with Russian govt. owned Rosneft.BP is betting big here with such deals especially when its recovering itself from the last years loss due to Gulf of Mexico Oil Spill when it wpas made to pay billions of dollars as punitive measure.
However as BP people say its a part of BP strategy to gain its ground in emerging energy needs markets.The companies said the future performance payments and the combined investment could amount to $20 billion in total.
Reliance Industries are set to gain access cutting edge technology with this deal while BP is said to gain access to new deep water blocks for gas and oil exploration purpose including KG D6 block in the Krishna-Godavari basin which is the richest block of RIL and is aimed to reach a peak production capacity of 80million cubic meters in 2013.
So its all good that India is finally attracting foreign investors for such huge investments but a word of caution should be used here,because it has become a trend here in India that you pay bribe to some minister to win cheap contracts of anything from spectrum allocation to oil exploration blocks and then you sell that thing to some foreign MNC on huge amounts and become one of the richest man in India,similar case must be kept in mind here unless we don't want again to see a 2G spectrum fraud,because point to come in mind is if Reliance or India doesn't have required technology expertise of oil and gas sector wouldn't it be better we import that new technology from outside instead of allotting already scarce and so valuable national resources to some foreign giant.And if Reliance doesn't have the required technology expertise how were they qualified to go for exploration bids,so I hope this time our government properly gear up the channels because every time we see or hear of India rising we see a scam behind it
BP has agreed to buy 30% stake in 23 oil and gas exploration blocks of Reliance for about $7.2billion to explore for deepwater oil and gas.BP would also pay an additional $1.8billion to Reliance if any commercially viable exploration or findings are achieved after the tie up.
This is the second major deal signed by BP under its new CEO Bob Dudley.Previous one was agreement of joint exploration of oil and gas in the Arctic with Russian govt. owned Rosneft.BP is betting big here with such deals especially when its recovering itself from the last years loss due to Gulf of Mexico Oil Spill when it wpas made to pay billions of dollars as punitive measure.
However as BP people say its a part of BP strategy to gain its ground in emerging energy needs markets.The companies said the future performance payments and the combined investment could amount to $20 billion in total.
Reliance Industries are set to gain access cutting edge technology with this deal while BP is said to gain access to new deep water blocks for gas and oil exploration purpose including KG D6 block in the Krishna-Godavari basin which is the richest block of RIL and is aimed to reach a peak production capacity of 80million cubic meters in 2013.
So its all good that India is finally attracting foreign investors for such huge investments but a word of caution should be used here,because it has become a trend here in India that you pay bribe to some minister to win cheap contracts of anything from spectrum allocation to oil exploration blocks and then you sell that thing to some foreign MNC on huge amounts and become one of the richest man in India,similar case must be kept in mind here unless we don't want again to see a 2G spectrum fraud,because point to come in mind is if Reliance or India doesn't have required technology expertise of oil and gas sector wouldn't it be better we import that new technology from outside instead of allotting already scarce and so valuable national resources to some foreign giant.And if Reliance doesn't have the required technology expertise how were they qualified to go for exploration bids,so I hope this time our government properly gear up the channels because every time we see or hear of India rising we see a scam behind it
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