Saudi Aramco plans unit in India, to open office soon: report

Saudi Aramco is all set to open an Indian subsidiary as the oil giant looks to tap increasing fuel demand in the world's third largest consumer and expand market, reports quoting sources close to the development said.

A Reuters report said Aramco representatives have met state government officials of West Bengal and Andhra Pradesh to scout for investment opportunities.

This is part of Saudi Aramco's strategy of overseas expansion by investing in refineries in major markets to lock in customers.

The company will also look for opportunities to acquire stakes in refining and petrochemical projects in the country. Aramco is also coming out with an initial public offer next year.

Saudi Arabia is competing with Iraq to be India's top oil supplier, with Iraq displacing it for a fifth month in a row in August, data compiled by Reuters showed.

The Reuters report said Aramco chief executive Amin Nasser will inaugurate Aramco Asia India during a visit to New Delhi next week to attend the IHS-CERA conference, which starts on Sunday.

Nasser is also expected to meet Prime Minister Narendra Modi on Monday as part of an industry delegation to discuss investment in the oil and gas sector, the report quoted sources as saying.

The report also said Mohammed Al-Mughirah, a company veteran who worked as deputy managing director at Aramco Asia Korea and is now handling crude sales, will head Aramco Asia India.

Investments in India will also help the Opec leader to get a closer view of the Indian market that has now started importing crude from the United States as well.

Major oil producers are now vying for lost market share in growing Asian markets due to the rise in US shale oil production.

On Monday, Saudi Aramco announced a strategic partnership with Malaysia's Petronas Chemicals Group Berhad (PCG) to enhance the value and competitive positioning of its petrochemicals projects within the Petronas Pengerang Integrated Complex (PIC) in the southern state of Johor.

Earlier this year Saudi Arabia pledged billions of dollars of investment in projects in Indonesia to ensure long-term oil supply deals.

Saudi Aramco had lost out an earlier opportunity to invest in India after Russia's Rosneft acquired a majority stake in private refiner Essar Oil.

Saudi Arabia's Energy Minister Khalid al-Falih has said that India was a prime target as Aramco looked for collaboration opportunities across Asia.

The International Energy Agency estimates India's refining capacity will lag fuel demand going forward, requiring investment in new plants.