Securities and Exchange Board of India, India's capital market regulator, has approved US energy major Chevron becoming one of the promoters of Reliance Petroleum Ltd [Get Quote].

The California-based Chevron would invest about $300 million to purchase five per cent of RPL, a company formed by Reliance Industries Ltd [Get Quote] to own and operate a new export refinery at Jamnagar, Gujarat.

"SEBI has now consented to Chevron becoming a co-promoter of RPL," a market source said.

RPL plans to invest $6 billion in a 580,000 barrels per day refinery, which is expected to begin operation in December 2008.

As per its deal with Reliance, Chevron has future rights to purchase additional shares to increase its equity ownership to 29 per cent. The US firm would would supply a third of crude oil that the new refinery needs from the spot market and help market high-octane fuel produced at the unit in US and other western markets.

Reliance currently operates a 660,000 barrels per day refinery in Jamnagar. The new refinery is designed to have a similar throughput capacity, but is expected to process heavier crude oil.

The new refinery would be the world's sixth largest refinery on a single site, and the two together would constitute the largest refinery complex in the world, based on current capacities.

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