MUMBAI: Reliance Industries will work with BP to address issues in ramping up production at its key gas block in India, its chairman said on Friday, referring to slowing gas production that has dampened the energy giant's growth outlook.
The conglomerate also plans to invest aggressively in its retail business and will launch cash-and-carry, or wholesale outlets, Mukesh Ambani said at the company's 37th annual shareholder meeting. Reliance Retail has made substantial investments over the past five years. Asserting that Reliance Retail has already become largest food retailer in the country, Ambani said that all the specialty formats of the company would attain top positions in their respective segments in next two years.
Ambani also said that Reliance Retail has already got the largest portfolio in terms of number of formats and 25 lakh customers were shopping at the company's various stores every week.
He said that further growth was expected in the retail business on the back of future investments and Reliance Retail was currently at an inflection point.
Reliance, the largest listed firm in India, is controlled by Mukesh Ambani, the world's ninth richest man with a net worth estimated at $27 billion, according to Forbes.
The company is looking to expand in sectors such as telecom, retail, power, financial services and hospitality.
"Reliance is endowed with a strong balance sheet and depth of talent," Ambani said, adding that the company was "uniquely placed to pursue multiple growth opportunities."
Last year, Reliance made a dramatic return to the telecom business with the $1 billion acquisition of Infotel Broadband, the only company to win a nationwide licence for broadband wireless spectrum in a government auction.
"Broadband - and broadband enabled digital services - is the next big leap forward in the digital transformation of our knowledge economy," Ambani said to shareholders.
He said the company plans to build broadband infrastructure spanning industries such as education, healthcare and financial services.
But energy is still the company's mainstay. Its D6 block in the Krishna Godavari basin off India's east coast is its biggest gas producer, but output has slipped due to technical problems to about 52 million cubic metres a day (mcmd) from 60 mcmd in 2010 and short of a target of 80 mcmd.
In February, Reliance agreed to sell a stake in 23 of its oil and gas blocks, including some in the KG basin, to BP in a $7.2 billion deal, and is expected to benefit from BP's deepwater exploration expertise.
"After the government approvals for BP-Reliance partnership, KG-D6 reservoir will be jointly assessed to address technical issues in ramping up production," Ambani said.
"Meanwhile, vigorous efforts are underway to accelerate development process of other discoveries," he said, referring to the company's Mahanadi block off the country's east coast and the Cambay block in the western Indian state of Gujarat.
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