Mumbai: Gas Authority of India Ltd (GAIL) and Reliance Industries Ltd RIL) have signed a memorandum of understanding (MoU) for co-operation in petrochemicals.
Under the MoU, GAIL and RIL will explore opportunities for setting up petrochemical complexes outside of India in feedstock-rich countries, RIL said in a filing with the Bombay Stock Exchange (BSE).
A K Purwaha, director (business development), GAIL and Nikhil Meswani, executive director, RIL, signed the MoU in Mumbai, in the presence of U D Choubey, chairman and managing director, GAIL and Mukesh D Ambani, chairman and managing director, RIL.
The two companies will set up a working group consisting of representatives from either side to examine and identify business opportunities. GAIL and RIL will form a special purpose vehicle (SPV) for setting up petrochemical complexes abroad.
The working group is examining such opportunities in the Middle East, Russia and other countries.
In addition, the two companies will also examine the possibilities of mutual co-operation in the domestic market.
This MoU, signed on 4 December 2007, marks the beginning of co-operation between GAIL and RIL in the area of petrochemicals. The two companies had, on 15 March 2007, signed a memorandum of understanding for co-operation in identified areas in the natural gas sector, including gas transportation pipeline, city gas distribution, coal-bed methane, exploration and production and operations and maintenance services.
"GAIL and RIL are India''''s leading companies in the energy and infrastructure sector. The decision will enable us to look for opportunities globally on a competitive scale for the petrochemical business which will further strengthen India''''s position on the global map," said RIL chairman Mukesh D Ambani.
GAIL CMD also spoke on the need for the two firms to work together.