Saudi Aramco eyes setting up JV in India next year

State-owned Saudi Aramco is in discussions with several Indian refiners to set up a new joint venture by 2018, CEO Amin Nasser told Reuters on Sunday.

The move came as part of Aramco’s strategy to tap rising demand growth opportunities and invest in the world’s third biggest oil consumer.

Asked if a deal could be finalized next year, Nasser said: “We hope so. We are in serious discussions.”

In June, India’s oil minister Dharmendra Pradhan said that the Saudi oil giant plans to buy a stake in the planned 1.2 million barrels per day (bpd) refinery in India’s west coast.

Nasser said Aramco is interested in investing in India’s downstream sector - refining, petrochemicals and fuel retailing, including lubricants.

The world’s top crude exporter is investing in refineries overseas to help secure demand for its oil and expand its market share ahead of its planned initial public offering (IPO) in 2018.

Saudi Aramco opened on Sunday a new office in New Delhi to expand its presence in India, which imports 81 percent of its oil needs from abroad.

“Aramco is a key partner for Indian refiners and there’s great potential to take our partnership to a higher level beyond the supply of crude oil, refined products and LPG to new areas of R&D, engineering and technology,” Pradhan said at the event.

“In return, India can offer cost and capacity advantages,” he added.

The New Delhi office will help attract Indian manufacturers and investors to participate in Aramco’s In-Kingdom Total Value Addition (IKTVA) program, the Saudi oil giant said in a statement.

The unit will also work towards qualifying more vendors in commodities that Aramco requires for its projects and operations.