Caltex parent company purchases stake in India refinery

Refinery: Chevron Corporation, the parent company of Caltex, will invest around $300 million for a stake in Reliance Petroleum Limited (RPL), a company formed by Reliance Industries Limited (Reliance), one of India's leading company's, to own and operate a new export refinery being constructed in Jamnagar, India.

RPL plans to commence an initial public offering (IPO) with the net offering to the public of 10 percent of the company from April 2006.

RPL plans to develop 580,000 barrels per day crude capacity refinery, which is expected to begin operations in December 2008. Chevron has future rights to purchase additional shares to increase its equity ownership.

In addition, Chevron announced the signing of two Memoranda of Understanding with Reliance. These cover the principles by which Reliance and Chevron will seek to optimize the refinery crude supply and product marketing and set out the intent of both companies to pursue other collaboration opportunities in the energy value chain.

"We are very pleased to have forged this relationship with Reliance, one of India's leading companies, which has excelled in the execution of world class projects. I look forward to working with Reliance in the development of the new refinery and jointly pursuing additional opportunities," Chevron Chairman and CEO Dave O'Reilly said.

Reliance currently operates 650,000 barrels per day refinery in Jamnagar. The new refinery is designed to have a similar throughput capacity, but is expected to process heavier crude oil. The new refinery would be the world's sixth largest refinery on a single site, and the two together would constitute the largest refinery complex in the world, based on current capacities.