Reliance Industries has for the first time teamed up with China's CNPC to win a gas block in Peru in an effort by the Mukesh Ambani-run company to expand its presence in Latin America.
Reliance Exploration and Production DMCC, a fully-owned subsidiary of Reliance Industries, along with China National Petroleum Corporation and Argentina's Pluspetrol last week won rights to explore for gas in Block 155, in the southern highland department of Puno, next to the border with Bolivia, industry sources said.
Meanwhile, Jindal Steel and Power Ltd teamed with up Enigma Oil and Gas Exploration (Pty) Ltd to win onshore blocks 147, 159 and 153 in Peru's 2008 bidding round that auctioned 17 new oil and gas blocks.
Reliance-CNPC-Pluspetrol offered royalty of 24.58 per cent to Peruvian government while Jinda-Enigma offered 30.02 to 32.03 per cent royalty, sources said.
Peru had originally offered 22 oil and gas lots, but received bids for only 17.
Reliance has, since April this year, steadily increased its presence in the Latin American nation. On June 29, it acquired 10 per cent stake in Lot 39 in northern Peru from Burligton Resources Inc.
In May, it had teamed up with Woodside Petroleum to acquire 50 per cent in Block 108 in Peru from Pluspetrol Energy SA. Of the 50 per cent stake acquired, Reliance got 30 per cent, while Woodside Petroleum got 20 per cent. Pluspetrol Energy will retain the remaining 50 per cent stake.
The company also acquired 90 per cent stake in Block 141 in Peru from Pan Andean Resources Plc in April this year.
Under the terms for Block 141, Pan Andean will dilute its interest in Block 141 to 10 per cent, in return for which Reliance Industries will incur all exploration costs through commercial discovery. Following a commercial discovery of an agreed size, Pan Andean will reimburse Reliance for its share of the exploration costs.
Block 141 is situated in 1.2 million acres (0.5 million hectares) of Andean mountain plateau and is believed to hold oil reserves. Reliance has committed $40 million investment in seismic surveys and drilling.
Reliance was looking at oil blocks in Latin America, particularly in the heavy oil belt. Excluding Peru, Reliance has 11 overseas oil and gas assets. It recently won permit to explore in Block W06-05 in Bonaparte Basin in Western Australia and has two blocks in Iraq, three in Yemen, one in East Timor and two each in Oman and Columbia.
The company is looking at opportunities in Africa, Latin America and West Asia.
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