BP, Europe's second-largest oil company, is reportedly in talk's with India's Reliance Industries, that country's largest company by market value, about acquiring a stake in a Reliance exploration block off the coast of east India. Sources with knowledge of the matter did not disclose a price tag for the deal.
The block BP is considering investing in is in the Krishna-Godavari Basin. BP (BP) is looking at purchasing a stake of between 30% and 45% in the block. Sources said Reliance and BP have been talks for some time now regarding the block. Reliance said BP is quite serious about making the purchase.
BP has declined to comment on the talks. The BP talks with RIL was first reported by the CNBC-TV18 news channel in January, according to Dow Jones. Reliance is currently producing natural gas from 18 wells in the block, though production has recently been declining and that may be one reason why Reliance is looking to BP.
The Indian government thinks production at the D6 block in the Krishna-Godavari Basin can reach its peak level within the next one or two years. Any advancement in technology, which BP could provide, is seen as an advantage for Reliance.