BP Pays $7.2B For Indian Blocks

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BP, Europe's second-largest oil company, will pay $7.2 billion for stakes in 23 exploration blocks owned by India's Reliance Industries in an effort by the British oil giant to boost its footprint in the second-fastest growing major economy in the world.

As part of the deal, BP (BP) will purchase a 30% in the blocks and the companies will form a joint venture to market gas, according to Bloomberg News. The deal is the second for BP this year following its controversial $16 billion share swap with OAO Rosneft, Russia's largest oil producer.

Reliance, India's largest company by market value, operates the country's largest natural gas field and has been looking to divest some of its mature assets in its home country to raise cash for international acquisitions. The deal with BP values the reserves acquired at about $7.50 a barrel of oil equivalent, about half the level BP achieved in its divestitures since the spill, Bloomberg reported.

The blocks that BP is taking stakes currently account for more than 40% of India's daily output. The transaction is subject to approval by India's government.