MOSCOW (MRC) -- Rosneft (Moscow) said on Wednesday that during a recent visit to India by the company’s chairman Igor Sechin it held negotiations with the management of Essar Oil achieving "preliminary mutual understanding" on the timing and structure of a deal for Rosneft to buy into the equity of Essar Oil, said the company on its site.
The parties intend to sign and close the transaction by the end of June 2016 on obtaining all the necessary permits. In addition an agreement on crude oil deliveries to commence this year has been reached.
As MRC informed earlier, in July 2015, Rosneft signed a preliminary agreement with the Essar group, controlled by the Ruias, to buy a 49% stake in Essar Oil’s Vadinar refinery and supply 100 million tonnes of oil to the latter for the next 10 years.
The capacity of Vadinar refinery currently amounts to 20 MMTPA. This refinery is the second largest in India and one of a top ten world’s best refineries. The refinery is highly flexible in terms of raw materials use and is capable of refining heavy and sour oil grades. Essar Oil Limited plans to implement the modernization program expanding the refinery’s capacity up to 25 million tonnes per annum including production of 1 million tonnes per annum of propylene/polypropylene.
Essar Oil Limited also owns an operational network of 2,000 fueling stations in India. The company’s plans include expanding the network up to 5,000 stations. Deregulation of pricing at the Indian retail market opens perspective of retail sales growth.
Rosneft became Russia's largest publicly traded oil company in March 2013 after the USD55 billion takeover of TNK-BP, which was Russia’s third-largest oil producer at the time.
MRC