A huge oil and petrochemicals refinery in western India could be developed, following a framework deal struck by Abu Dhabi National Oil Company (ADNOC), Saudi Aramco, and a three-strong consortium of Indian oil giants.

A framework agreement to explore development of a $44bn (AED168bn) "mega refinery" was signed by the five parties on June 25 in India's capital city, New Delhi.

The agreement set out conditions for a strategic partnership, mutual investment, and development of the yet-to-be-built facility in Ratnagiri, located on India’s west coast.

A new joint venture (JV) business called Ratnagiri Refining and Petrochemical Company was created following the agreement.

READ: UAE's ADNOC to build world’s largest petrochem site worth $45bn

ADNOC and Saudi Aramco will co-build, own and operate the refinery in conjunction to the Indian trio, which consists of Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation. The three of them will jointly own a 50% stake in the JV outfit. ADNOC and Saudi Aramco share the remaining 50% proportion.

The signing of the historic agreement, which is ADNOC's first overseas refinery investment, was witnessed by HH Sheikh Abdullah bin Zayed bin Sultan Al Nahyan, UAE Minister of Foreign Affairs and International Cooperation.

He said: "This agreement strengthens the already close ties between the UAE and the Kingdom of Saudi Arabia and between the UAE and India. The UAE is unwavering in its commitment to its strategic multi-lateral relationships with both Saudi Arabia and India, as well as being a reliable partner in India’s energy security."

HE Dr Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC group chief executive officer, said the agreement reflected the oil giant's "expanded downstream strategy" and offtake for its crude product to the "key growth economy" of India. 

President and chief executive officer of Saudi Aramco, Amin Nasser, said the Ratnagiri project will help India meet its "rising demand for fuels and chemical products".

Nasser suggested the deal with ADNOC and the triumvirate of Indian companies could be the catalyst for more collaboration in the future, stating: "This project also positions us for future collaboration, as a key element of our company’s global downstream strategy”.

A timeline for construction of the $44bn refinery was not disclosed in a joint statement about the tri-partite agreement.

Meanwhile, ADNOC's push into India comes after it confirmed plans to create the world’s largest integrated refining and petrochemicals complex as part of its Ruwais expansion programme, worth $44.9bn (AED165bn). 

The entire Abu Dhabi complex will be upgraded to boost production volumes as part of the large-scale expansion strategy.

Separately, work on the $5bn (SAR18.75bn) Saudi Aramco-Total petrochemical complex is set to start in Q3 2018. News of this came after a memorandum of understanding was signed by both companies in April this year.