With the merger of the firm's oil-to-chemical business, RIL comes out with a new unit

With the merger of the firm's oil-to-chemical business, RIL comes out with a new unit, Reliance Industries Ltd. has come out with a  new unit. This will help it pursue growth opportunities with strategic partnerships, the company has said.

The oil-to-chemical (O2C) business unit holds Reliance's oil refinery and petrochemical assets and retail fuel business but not upstream oil and gas producing fields such as KG-D6 and textiles business.

For the first time, Reliance reported integrated earnings of the O2C business in its third quarter financial results. Earlier, the refining and petrochemical businesses reported separately while fuel retailing revenue was part of the firm's overall retail business.

In the October-December 2020 earnings statement, refining and petrochemical as well as fuel retailing businesses earnings were reported as one. As a result, it did not give refining margins the most sought after number to assess the firm's oil refining business.

"Reorganising refining and petrochemicals as oil-to-chemicals (O2C) reflects new strategy as well as management matrix," the company said in a post earning investor presentation.

This, it said, will "facilitate holistic and agile decision making" as well as "pursue attractive opportunities for growth with strategic partnerships".

Reliance started work on hiving off the O2C business into a separate unit last year for a possible stake sale to companies such as Saudi Aramco. The company, however, did not mention discussions with Aramco, which are said to have hit a valuation roadblock.

Reliance O2C Limited houses oil refining and petrochemical plants and manufacturing assets, bulk and wholesale fuel marketing and Reliance's 51 per cent interest in retail fuel joint venture with BP of the UK.

The O2C unit also houses the firm's Singapore and the UK-based oil trading subsidiaries and marketing subsidiary Reliance Industries Uruguay Petroquimica SA.

It also houses Reliance Ethane Pipeline Limited that operates a pipeline between Dahej in Gujarat and Nagothane in Maharashtra as well as 74.9 per cent stake that Reliance holds in the joint venture with Sibur.