Indian, Russian Firms Working on Gas and Petrochemical Projects

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Researched by Industrial Info Resources (Sugar Land, Texas)--Parallel with the top-level government interchanges between the BRIC (Brazil, Russia, India ,China) countries, major project alliances are being forged between major industrial groups among these countries, whose fast-growing economies are driving the margins of growth globally.

India's state-controlled gas utility GAIL (Bombay) and Russia's Lukoil (Moscow, Russia) are working together on several projects. GAIL Chairman U. D. Choubey, in Moscow to attend the second International Energy Week, met with top executives of Russian oil and gas companies, covering possibilities in his firm's participation in gas fields, petrochemical plants and city gas projects. Discussions have taken place with the Russian gas company Itera to set up a gas distribution network in Moscow to retail compressed natural gas (CNG) for use in autos. A methane-based petrochemical plant to be set up in Russia was also discussed with Lukoil.

In the Middle East, GAIL plans to build a petrochemical plant in Qatar with an annual production capacity of 1 million tons of polymers for export. Choubey indicated that GAIL was keen to pick up a stake in Lukoil's rich gas field Block A in Saudi Arabia in the Empty Quarter near Ghawar. The two companies may set up a petrochemical plant in Saudi Arabia using gas feed from Block A and also export liquefied natural gas to India. Lucile has an 80% stake in the 29,000-square-kilometer block with the balance being held by Saudi Aramco. Lukoil is the world's second largest private oil company by proven hydrocarbons reserves, which at the beginning of 2007 were 15.9 billion barrels of crude oil and 26.5 billion cubic feet of gas.

A joint working group has been set up by the two companies to work on a concept memorandum of understanding and structure and schedule of partnership between the companies. "We are in discussions and in we should have a blueprint of areas of cooperation in the next 3 to 6 months," Choubey said.

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