Reliance Industries Ltd (RIL) will form a petrochemical joint venture with UAE's state-owned oil company Abu Dhabi National Oil Company (ADNOC) and will be investing up to $1.5 billion.
The two companies have finalised an agreement for the joint venture, almost one-and-a-half years after signing a framework agreement for the same, the Economic Times reported.
The Mukesh Ambani-led company will invest $1.2-$1.5 billion to manufacture ethylene dichloride (EDC) at a factory next to ADNOC's integrated refining and petrochemicals hub in Ruwais. The UAE-based company is also likely to invest a similar amount in the joint venture.
The companies are likely to announce the new deal this week, the publication said. RIL will also set up an international base in UAE to benefit from the Gulf nation's liberal tax policies.
Announcing the signing of framework agreement in December 2019, the companies had said ADNOC would supply ethylene to the potential joint venture and provide access to world-class infrastructure at Ruwais, while RIL will deliver operational expertise and entry to the large and growing Indian vinyls market.
"This is a significant step towards Reliance's commitment to pursue backward integration and will pave the way for enhancing PVC capacity in India to cater to the fast growing domestic market. This co-operation ideally combines advantaged feedstock and energy from the UAE with Reliance's execution capabilities and the growing Indian market," RIL Executive Director Nikhil R. Meswani had said then.
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