Rosneft of Russia, the world’s largest public sector oil and gas company, and Essar Global Fund Ltd., an investment fund of the diversified Essar group, have signed key terms of oil and oil products supplies to Essar’s refineries.
Supplies are likely to begin in 2015.
The document was signed in New Delhi in the presence of visiting Russian President Vladimir Putin and Prime-Minister Narendra Modi, Essar said in a statement here.
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Since Russia is affected by economic sanctions imposed by the U.S. and the EU due to its alleged involvement in Ukraine, Rosneft, with this deal, will have a secured market outlet for its oil and oil products. Essar will have a reliable and stable partner as a supplier of oil and oil products to its refining facilities. “The strategic potential of reached agreement between Rosneft and Essar can hardly be overestimated,” Head of Rosneft Igor Sechin said.
“The implementation of the contract will fuel significant growth in the goods turnover between two countries,’’ Mr. Sechin said. “We are happy to partner Rosneft for long-term supply of crude oil and products. This provides good long-term raw material security to our refineries,” said Essar group Chairman Shashi Ruia.
Essar group company Essar Oil owns the second largest single site refineries, having a capacity of 20 million metric tonnes annually.
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