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ambani’s reliance group backs out of its commitment of investing $15 billion in saudi aramco

The deal was announced more than two years ago by Reliance chairman Mukesh Ambani, Asia’s richest man, and touted as the biggest foreign investment in the conglomerate’s history.

(FILES) This file photo taken on March 22, 2006 shows a general view of oil tanks at a plant in Haradh, about 280 kilometres (170 miles) southwest of the eastern Saudi oil city of Dhahran, following its inauguration launching a project adding 300,000 barrels of oil to the kingdom's daily production capacity. Two pumping stations on a major Saudi oil pipeline were attacked by drones on May 14, 2019, halting the flow of crude along it, Saudi Energy Minister Khalid al-Falih said. He said the attacks on the pipeline from the oil-rich Eastern Province to the Red Sea took place early in the day. Yemen's Huthi rebels said that they had targeted several vital Saudi targets with drones. / AFP / -

Reliance conglomerate of India is backing out of its commitment of buying $15 billion worth stake in Saudi Aramco.

Mukesh Ambani, India’s richest businessman’s group, Reliance announced $15 billion deal for Saudi Aramco to buy a 20 percent stake in its oil refining and chemicals unit. But now Reliance is switching its investment towards renewable energy, throwing away its commitment with Aramco, state-run Saudi oil giant.

The Aramco Oil Refinery in Dahran, Saudi Arabia, Middle East. (Photo by: MyLoupe/UIG via Getty Images)

The deal was announced more than two years ago by Reliance chairman Mukesh Ambani, Asia’s richest man, and touted as the biggest foreign investment in the conglomerate’s history.

But Reliance and other major Indian firms have since poured billions of dollars into green power as the government pushes to reduce its dependence on imported fossil fuels and as the country’s cities are assailed by pollution.

Saudi Aramco is the world’s biggest oil-producing company and vies with Apple for the title of the most valuable firm on the planet.

Ambani in June this year pledged to invest $10 billion in renewable energy over the next three years.

Reliance said in a late-night statement Friday that due to its “evolving” portfolio of businesses, the two firms had “mutually determined that it would be beneficial for both parties to re-evaluate the proposed investment”.

It was withdrawing a legal application that would have paved the way for Saudi Aramco to take the stake in its oil-to-chemicals division, it added.

The unit includes Reliance’s refining, petrochemicals and fuels marketing businesses, among them the giant Jamnagar refinery in Gujarat, Prime Minister Narendra Modi’s political powerbase.

Reliance recently announced it would build four “giga factories” at Jamnagar making solar panels, storage batteries, and hydrogen-related products to create one of the largest integrated renewable energy manufacturing facilities in the world.

The Mumbai-headquartered firm’s rise was powered by its oil and petrochemicals businesses but in recent years it has diversified into areas ranging from telecoms to retail.

Javed Mahmood
Written By

I am an experienced writer, analyst, and author. My exposure in English journalism spans more than 28 years. In the past, I have been working with daily The Muslim (Lahore Bureau), daily Business Recorder (Lahore/Islamabad Bureaus), Daily Times, Islamabad, daily The Nation (Lahore and Karachi). With daily The Nation, I have served as Resident Editor, Karachi. Since 2009, I have been working as a Freelance Writer/Editor for American organizations.

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