BP to Partner with Reliance

BP and Reliance Industries have entered into a partnership to explore for deepwater oil and gas in India.

BP it would pay Reliance Industries $7.2 billion to take a 30 percent stake in 23 oil and gas blocks and forming a 50:50 joint venture for sourcing and marketing gas.

BP would also pay performance payments of up to $1.8 billion if the tie-up leads to the development of commercial discoveries.

"BP is the best finder of hydrocarbons in deepwater in the world," Mukesh Ambani, Chairman and Managing Director of Reliance Industries, said at a press conference.

"The whole world's looking for gas, particularly in Asia... we believe it is going to be a very, very valuable fuel," commented BP Chief Executive Bob Dudley, adding that the blocks involved had indicated resources of around 15 trillion cubic feet.

BP move is one of the biggest foreign direct investments in India to date with a $7.2 billion tie-up with the country's Reliance Industries

BP already has a presence in India, including an interest in a deepwater block called D-17, which it has been working on with Reliance Industries since late 2008.