BP-Reliance Deal Said Likely to Get Approval From India Cabinet Next Week

BP Plc (BP/)’s plan to buy stakes in 23 oil and gas blocks in India operated by Reliance Industries Ltd. (RIL) for $7.2 billion may get cabinet approval next week, an oil ministry official with knowledge of the matter said.
The oil ministry has recommended that the deal go through and referred it to the cabinet because of the large investment involved, the official, who asked not to be identified, told reporters in New Delhi yesterday.
BP wants to tap demand in Asia’s second-biggest energy- consuming nation and announced the partnership with Reliance Industries on Feb. 21. BP plans to acquire a 30 percent stake in each of the Reliance blocks, including KG-D6 off India’s east coast, the nation’s biggest gas deposit, where output has fallen because of technical difficulties at the reservoir.
“Reliance is having problems raising production from the KG-D6 field and getting BP as a partner should remedy that,” D.K. Aggarwal, chairman of SMC Wealth Management Services Ltd., said by telephone from New Delhi. “A straightforward approval helps Reliance immensely.”
Reliance rose 2.1 percent to 870.70 rupees at the close in Mumbai, the biggest gain in two weeks. The stock has dropped 18 percent this year, compared wholesale iphone  with a 7 percent decline in the benchmark Sensitive Index. BP gained 0.5 percent at 11:39 a.m. in London trading.
Boosting Output
Reliance, controlled by billionaire Chairman Mukesh Ambani, is seeking BP’s technology and expertise to increase output from the field, which has dropped to about 50 million cubic meters a day from a peak rate of 60 million set in June last year.
“After the government approvals for the Reliance-BP partnership, the KG-D6 reservoirs will be jointly assessed to address the technical issues in ramping up production,” Ambani told shareholders on June 3.
Mumbai-based Reliance’s net income grew at the slowest pace in six quarters in the three months ended March 31 after gas output dropped.
The deal between Reliance and BP has no “loose issues,” India’s Oil Minister S. Jaipal Reddy said Feb. 22.
Vedanta Resources Plc (VED)’s proposed takeover of Cairn India Ltd., operator of the nation’s largest onshore oil deposit, was approved by the cabinet last week with conditions, more than 10 months after the deal was announced.
BP’s proposed acquisition has been referred to the Cabinet Committee on Economic Affairs, Press Trust of India reported yesterday, citing unidentified people familiar with the matter.
The $7.2 billion will be paid in the year ending March 31, Chairman Ambani said Feb. 21. Reliance has received $2 billion from BP, the Indian explorer said in an April 21 statement.
BP and Reliance will also form a venture to market gas, according to the Feb. 21 statement. Future performance payments and investments could increase the size of the deal to $20 billion, BP said that day.

Dreambox dm800 HD pvr satellite receiver

DreamBox DM 500 PVR satellite receiver

AZBOX HD Premium satellite receiver

Openbox S9 HD PVR satellite receiver

Dreambox DM500s satellite receiver

Dreambox DM500HD satellite receiver

Trichet Signals Further ECB Rate Increase

European Central Bank President Jean- Claude Trichet signaled he may raise interest rates again in coming months and will ease Portugal’s access to emergency funds as officials battle both faster inflation and the debt crisis.
The ECB increased its benchmark rate by 25 basis points to 1.5 percent today, the second increase in three months. The decision on Portugal came after Moody’s Investors Service sparked a renewed selloff in euro region bond markets, saying on July 5 the country may need a second bailout package.
“Our monetary policy stance remains accommodative,” Trichet said at a press conference in Frankfurt. “It is essential recent price developments do not give rise to broad based inflation pressures over the medium term.”
Policy makers are trying to balance the risks of further turmoil in debt markets against the danger that Germany’s export-led recovery will fuel a wage-price spiral. While the yield on Greek, Irish and Portuguese two-year bonds all exceed 15 percent, inflation across the region has breached the central bank’s 2 percent limit for the past seven months.
Trichet said the ECB will suspend its minimum credit-rating threshold on Portuguese bonds after Moody’s lowered the country’s debt to junk. The suspension will be maintained “until further notice,” he said. This follows the ECB waiving minimum threshold for Greek and Irish bonds.
Portuguese Plan
“The Portuguese government has approved an economic and financial adjustment program which has been negotiated with the European Commission, in liaison with us, and the International Monetary Fund,” he said. “The Governing Council has assessed the program and considers it appropriate.”
The euro erased its decline against the dollar after Trichet’s remarks and traded at $1.4324 as of 3:12 p.m. in London, little changed since yesterday. European stocks rose to a one-month high, with the Stoxx Europe 600 index surging as much as 1.1 percent to 278.01. The Stoxx 50 gained 0.9 percent.
European bond yields have risen to a record on renewed concern that the debt crisis is spreading across the region. Trichet is at odds with European leaders over how to contain the debt crisis, saying it’s up to nations to plug budget gaps as policy makers fight price gains.
“I have a lot of questions on Ireland, Portugal, Greece,” Trichet said in response to reporters at the press conference today. “Shall I remind you that we’re responsible for price stability for the euro area as a whole. Those issues which you’re addressing constantly should be addressed to governments, they’re responsible.”
Default Risk
European finance ministers earlier this month authorized an 8.7 billion-euro ($12 billion) loan payout to Greece in an attempt to avert the region’s first sovereign default. Standard & Poor’s and Fitch Ratings have both indicated they would cut Greece to default if leaders went ahead with a plan to ask creditors to roll over expiring Greek bonds into new debt.
“We say ‘no’ to selective default or credit event,” Trichet said. He declined to comment on whether the ECB would use its own judgment or rely on ratings companies to determine if there is a default.
Trichet also said that inflation, which was 2.7 percent in June, is likely to remain above the ECB’s 2 percent ceiling in the coming months. He declined to say whether today’s decision is the beginning of a rate-hiking cycle, saying the central bank is never “pre-commited” on decisions.
‘Door Open’
Trichet’s statement “leaves the door open to more hikes,” said Silvio Peruzzo, an economist at Royal Bank of Scotland Group Plc in London. While Trichet’s language may hint at an increase in September, the ECB could also wait until the following month, he said.
The Bank of England kept borrowing costs at 0.5 percent in London today. In Sweden, the Riksbank raised its benchmark repurchase rate to 2 percent on July 5, the seventh increase in a year. The People’s Bank of China yesterday raised key rates for the third time this year.
While leaders are still seeking ways to fight the crisis, Europe’s recovery is already losing momentum. Services and manufacturing growth slowed more than estimated in June and economic confidence weakened. In Germany, Europe’s largest economy which has powered the region’s recovery, investor sentiment dropped to a 2 1/2-year low last month.
“As expected, recent economic data indicate some deceleration in the pace of economic growth in the second quarter,” Trichet said. “While the underlying momentum of economic growth in the euro area continues to be positive, uncertainty remains elevated.”
The ECB last month forecast euro-region growth to slow to 1.7 percent next year from 1.9 percent in 2011. The inflation rate may fall below its 2 percent ceiling in 2012, averaging 1.7 percent, the central bank estimated.
Trichet was a “little bit dovish on the growth outlook,” said Kornelius Purps, a fixed-income strategist at UniCredit SpA in Munich. Still, “it is obvious that the ECB has further to go, there will be one more rate hike at least this year.”

Dreambox dm800 HD pvr satellite receiver

DreamBox DM 500 PVR satellite receiver

AZBOX HD Premium satellite receiver

Openbox S9 HD PVR satellite receiver

Dreambox DM500s satellite receiver

Dreambox DM500HD satellite receiver