MIRA INFORM REPORT

Report Date :

24^TH June, 2006

IDENTIFICATION DETAILS

Name :	RELIANCE PETROLEUM LIMITED
Registered Office :	Motikhavdi, P.O. Digvijaygram, District Jamnagar 361140, Gujarat, India
Country :	India
Financials (as on) :	28.02.2006
Date of Incorporation :	24.10.2005
Com. Reg. No.:	04-48030
CIN No.: [Company Identification No.]	U11100GJ2005PLC048030/U99999MH2005PTC156971
TAN No.: [Tax Deduction & Collection Account No.]	RKTR01044B
PAN No.: [Permanent Account No.]	AAACR5691P
Legal Form :	A Public Limited Liability Company. The company’s shares are listed on the stock exchange
Line of Business :	Company is engaged in Refinery Project

RATING & COMMENTS

MIRA’s Rating :

B

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small

Maximum Credit Limit :
Status :	New Project
Payment Behaviour :	Slow but Correct
Litigation :	Clear
Comments :	Subject is a new company of Reliance Group, one of the largest industrial houses in India, chaired by Mr. Mukesh Ambani. The company came out with its maiden public issue recently, which was a great success. The refinery project is under implementation and is expected to commence commercial activities in December 2008. Payments are reported as slow but correct. The company can be considered for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	Motikhavdi, P.O. Digvijaygram, District Jamnagar 361140, Gujarat, India
Tel. No.:	91 288 3011 805
Fax No.:	91 288 3011850
E-Mail :	rpl.ipo@ril.com
Website :	http://www.reliancepetroleum.com
Corporate Office :	3rd Floor, Maker Chambers IV, 222 Nariman Point, Mumbai 400 021,
Tel. No.:	91 22 2278 5214
Fax No.:	91 22 2278 5111

DIRECTORS

Name :	Mr. Mukesh D. Ambani
Designation :	Non-Executive Chairman
Address :	Sea Wind, 39, Cuffe Parade, Colaba Mumbai 400 005
Date of Birth/Age :	48
Other Directorships	Reliance Industries Limited Chairman Reliance Europe Limited Indian Petrochemicals Corporation Limited Reliance Retail Limited Pratham India Education Initiative
Name :	Mr. Hital R. Meswani
Designation :	Director
Address :	Woodlands, Flat No C – 23/24 67 Pedder Road, Mumbai 400 026
Date of Birth/Age :	37
Other Directorships	Reliance Industries Limited Reliance Industrial Investments & Holdings Limited
Name :	Mr. Manoj Modi
Designation :	Director
Address :	Flat No. 7, BEST Apartments,Walkeshwar, Mumbai 400 006
Date of Birth/Age :	48
Other Directorships	Reliance Retail Limited Tally Solutions Private Limited
Name :	Mr. P. M. S. Prasad
Designation :	Director
Address :	92/93, Bakhtawar Co-operative Society Limited, 22, Narayan Dabholkar Road, Mumbai 400 006
Date of Birth/Age :	54
Other Directorships	Jamnagar Ratlam Pipeline Company Limited Jamnagar Kandla Pipeline Company Limited Reliance Gas Pipelines Limited Reliance Infrastructure Limited Delphinus Commercials Private Limited
Name :	Mr. Y. P. Trivedi
Designation :	Director
Address :	“Mistry Manor”, 62-A Napean Sea Road Mumbai 400 006
Date of Birth/Age :	77
Other Directorships	Reliance Industries Limited Safari Industries (India) Limited Colosseum Sports & Recreation International The Supreme Industries Limited Birla Power Solutions Limited Sai Service Station Limited The Zandu Pharmaceutical Works Limited Zodiac Clothing Company Limited Ushdev International Limited Clare Mont Trading Private Limited Telstar Travels Private Limited Trivedi Consultants Private Limited Monica Travels Private Limited Bloomingdale Estates Private Limited Metro Exporters Private Limited

Name :	Mr. M. P. Modi
Designation :	Director
Address :	B-92 Sector 27Noida 201 301 (U.P.)
Date of Birth/Age :	66
Other Directorships	Reliance Industries Limited Mangalore Refinery and Petrochemicals Limited ICICI Prudential Life Insurance Company Limited
Name :	Mr. Atul S. Dayal
Designation :	Director
Address :	21, Valentina, Naoroji Gamadia Road, Mumbai 400 026
Date of Birth/Age :	57
Other Directorships	Reliance Power Ventures Ltd Pudumjee Agro Industries Ltd Gammon India Ltd Actavis Pharma Limited Goa Publications Private Limited SMS Biopharma Private Limited Harbingers Developers Private Limited Novation Developers Private Limited Millennium Developers Private Limited Arcadia Estates and Developments Private Limited Spectrum Informative Services Private Limited Pavna Agro Farms Private Limited
Name :	Mr. Bobby Parikh
Designation :	Director
Address :	7th Floor, The Jackers, 113 Carter Road,Bandra West, Mumbai 400 050
Date of Birth/Age :	41
Other Directorships	HDFC Bank Limited Erix Advisors Private Limited
Name :	Mr. K Sethuraman
Designation :	Company Secretary and Compliance Officer
Address :	3rd Floor, Maker Chambers IV,222 Nariman Point, Mumbai 400 021, India.
Date of Birth/Age :	+91 22 2278 5214;
Qualification :	+91 22 2278 5111.
Experience :	rpl.ipo@ril.com

MAJOR SHAREHOLDERS

Names of Shareholders	No. of Shares	Percentage of Holding
Reliance Industries Limited	2,700,000,000	85.71
Fidelity Shares & Securities Pvt. Ltd	75,000,000	2.38
Life Insurance Corporation of India	67,500,000	2.14
State Bank of India	50,000,000	1.59
Goldman Sachs Investments (Mauritius) I Limited	47,000,000	1.49
Industrial Development Bank of India Limited	33,500,000	1.06
Global Investment House KSC (Closed) , Kuwait	22,000,000	0.70
Punjab National Bank	21,500,000	0.68
Bank of Baroda	20,000,000	0.63
Canara Bank	20,000,000	0.63
Deutsche Securities Mauritius Limited	15,000,000	0.48
Citigroup Global Markets Mauritius Private Limited	15,000,000	0.48

BUSINESS DETAILS

Line of Business :

Company is engaged in Refinery Project

GENERAL INFORMATION

Bankers :

State Bank of India Corporate Accounts Group Branch Voltas House, 23, J N Heredia Marg Ballard Estate Mumbai 400001 Tel: + 91 22 2267 1916 Fax: + 91 22 2267 9030 HDFC Bank Limited Manekji Wadia Building Nanik Motwane Marg Fort, Mumbai 400023 Tel: +91 22 2270 3390 Fax: +91 22 2270 3392 IDBI Bank Limited 224 A Mittal Court, A Wing Nariman Point Mumbai 400021 Tel: +91 22 2202 4831 Fax: +91 22 2282 4071 ICICI Bank Limited 215, Free Press House Nariman Point Mumbai 400021 Tel: +91 22 2284 2947 Fax: +91 22 2285 3591

Facilities :

--

Banking Relations :	--
Auditors :	Chaturvedi & Shah Chartered Accountants (member of Nexia International) A-3, Laxmi Towers, first floor, Bandra Kurla Complex, Bandra (East), Mumbai 400 051, India. Tel: + 91 22 3061 6100 Fax: + 91 22 3061 6125 Deloitte Haskins & Sells Chartered Accountant, 12, Dr. Annie Besant Road, Opposite Shiv Sagar Estate Worli, Mumbai 400 018, India Tel: + 91 22 5667 9000 Fax: + 91 22 5667 9100
Associates/Subsidiaries :	Reliance Industries Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
10,000,000,000	Equity Shares	Rs. 10/- Each	Rs. 100000.000 Millions
5,000,000,000	Preferences Shares	Rs. 10/- Each	Rs. 50000.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
270,000,0000	Equity Shares	Rs. 10/- Each	Rs. 2700.000

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		28.02.2006
SHAREHOLDERS FUNDS
1] Share Capital		27000.000
2] Share Application Money		0.000
3] Reserves & Surplus		0.000
4] Miscellaneous Expenditure		0.000
NETWORTH		27000.000
LOAN FUNDS
1] Secured Loans		0.000
2] Unsecured Loans		0.000
TOTAL BORROWING		0.000
DEFERRED TAX LIABILITIES		0.000
TOTAL		27000.000
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		11119.210
Capital work-in-progress		15905.460
INVESTMENT
DEFERREX TAX ASSETS
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	0.000
	Sundry Debtors	0.000
	Cash & Bank Balances	0.960
	Other Current Assets	0.000
	Loans & Advances	0.000
Total Current Assets		0.960
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	49.730
	Provisions	0.300
Total Current Liabilities		50.030
Net Current Assets		(49.070)
MISCELLANEOUS EXPENSES		24.400
TOTAL		27000.000

KEY RATIOS

PARTICULARS	28.02.2006
Debt Equity Ratio (Total Liability/Networth)	--
Current Ratio (Current Asset/Current Liability)	0.01

LOCAL AGENCY FURTHER INFORMATION

Reliance Infrastructure Limited (“RFL”), a subsidiary of RIL, intends to lease about 1,700 acres of land to us for the Project. To date, it has acquired about 1,100 acres of land and needs to acquire an additional 600 acres of land in order that they may implement the Project. Any delay in acquiring such land by RFL or subsequently leasing it to us will have a material adverse effect on the Project. There can be no assurance that RFL will acquire the necessary land and lease it to us, or that it will do so in a timely manner. The timely completion of the Project involves managerial and logistical challenges for RIL, RIL’s Affiliates and us. Any significant delay in completing the Project as planned or on schedule may result in RPL commencing operations in an increased competitive environment for premium products. This may be due to the addition of new refining capacity by competitors as well as upgradation of existing refineries. Such a scenario may have a material adverse effect on their business, results of operations and financial condition.

intend to commence commercial operations of the refinery and polypropylene plant in, or

around, December 2008

Upon completion of the Issue, RIL will continue to hold 80% in their share capital. Since RIL will have multiple roles with respect to us, as a service provider and a majority shareholder, they may be limited in their ability to negotiate with RIL and its Affiliates and the agreements that they enter into with RIL and its Affiliates may not be on the most favourable terms forus. As RIL also operates a refinery and petrochemicals complex which is larger than their proposed refinery and polypropylene

plant, RIL may compete directly with us in the future. In addition, as noted above, in the event they have a conflict of interest with RIL, the resolution of such a conflict may not be on the most favourable terms to us.

Conflicts of interest may arise between us and RIL in a number of areas including:

direct or indirect competition with respect to the purchase, allocation and transportation of crude oil and other

feedstocks;

_ direct or indirect competition with respect to the marketing and sales of refined products and polypropylene;

_ deputing managers and other employees as needed by us;

_ business combinations involving their company; and

_ business opportunities that may be attractive to both RIL and us.

They expect to lease the land required for the Project along with related infrastructure such as roads, storm water drains, etc. under a long term lease from Reliance Infrastructure Limited (RFL), which is the developer of the SEZ in Jamnagar. For providing these facilities, they are expected to place a deposit of Rs. 2,990 million to RFL. They are also expected to place deposits of Rs. 1,500 million each to RUPL and RPTL, respectively, for the use of power and utilities and ports and terminal services to be established by them. These deposits are as estimated by us and the actual deposits may vary.

The dangers inherent in their proposed operations could cause disruptions and could expose us to significant losses, costs or liabilities. They are particularly vulnerable to disruptions in their operations because all of their refining operations will be conducted at a single location.

Their proposed refinery and polypropylene operations are subject to significant hazards and risks inherent in refining and petrochemicals operations and in transporting and storing crude oil, intermediate products and refined products. These hazards and risks include:

natural disasters;

_ fires;

_ explosions;

_ ruptures and spills from crude and product carriers or storage tanks;

_ third-party interference;

_ disruption of deliveries of crude oil or refined products;

_ disruptions of electricity, water and other utility services;

war or terrorism;

_ communal unrest; and

_ mechanical failures of equipment at their refinery and polypropylene plant or third-party facilities nearby.

Their refinery and polypropylene plant consists of many processing units. One or more of the units may require unscheduled downtime for unanticipated maintenance or repairs, or their planned turnarounds may last longer than anticipated. Normally, the refinery and polypropylene plant shuts down for maintenance approximately once in every three to four years for about 45 to 60 days. Such scheduled and unscheduled maintenance closures could reduce their revenues and increase their costs during the period that their units are not operating.

They do not intend to begin test operations until, or around, December 2008. As a new facility, operations of the refinery and polypropylene plant will be subject to various uncertainties relating to the ability to process crude oil and other feedstocks, and produce refined petroleum products and polypropylene as planned, including the potential failure of any key equipment. RIL has operated a refinery and petrochemicals complex located at Jamnagar in Gujarat since 2000 and will assist us in starting-up their refinery and polypropylene plant. However, they cannot assure you that their new refinery and polypropylene plant will reach full capacity or achieve results comparable to those of RIL’s existing refinery and petrochemicals complex.

In addition, their refinery and polypropylene plant is proposed to be located in a Special Economic Zone (an “SEZ”), to be developed by RFL. The Special Economic Zone Act, 2005 (the “SEZ Act”), which prescribes the regulations to establish and operate within an SEZ, has conferred significant tax and other fiscal benefits to units and companies that operate such units in an SEZ, as outlined under “Regulations and Policies” on page 71. RFL has received approval to develop the SEZ, but the SEZ is yet to be notified by the central government. After such notification is made, they have to apply and receive approval for setting up the Project as a Unit in the SEZ. The Project will be eligible for the concessions and benefits only after receipt of such approvals. However, they cannot guarantee that they will receive such benefits or continue to receive them. Their receipt of such benefits is subject to the condition that they achieve positive net foreign exchange earnings at the end of five years from the date of commencement of commercial operations of the refinery and polypropylene plant and at the end of every subsequent five year period. Positive net foreign exchange earnings are achieved if their foreign earnings are greater than their foreign spending and they cannot assure you that they will achieve positive net foreign exchange earnings. The loss of the concessions and benefits provided to us under the SEZ Act would have a material adverse effect on their business, results of operations and financial condition. The SEZ Rules, 2006, provide that if the Approval Committee of the SEZ determines that the SEZ Unit has not achieved positive net foreign exchange earnings, then the SEZ Unit will be liable for penal actions under the provisions of the

Foreign Trade (Development and Regulation) Act, 1992.

RIL and its Affiliates are involved in legal proceedings that have been initiated against them.

There were approximately 1,260 cases filed against RIL and its Group Companies as on December 31, 2005. Out of the above cases, 294 cases are those in which damages and compensation is sought for delay in transfer of shares/debentures, 381 cases are those involving disputes with respect to transfer or demat of shares and 35 cases involve appeals/revisions preferred by the Company. The balance 475 cases include criminal cases, civil cases, labour cases, income tax, sales tax, customs, excise, and consumer cases. The value, where quantifiable, involved in cases of Rs. 500 million or above in the

case of RIL and Rs. 50 million or above in the case of IPCL and RIIL, totals approximately Rs. 36,160.48 million as on date.

Some of RIL’s Group Companies have incurred losses in the previous fiscal years.

Details of the profits/ (losses) incurred by them in previous financial years ending are as given below:

Amount in Rs. million

Company	Year ended March 31, 2005	Year ended March 31, 2004	Year ended March 31, 2003
Reliance Ventures Limited	0.22	0.12	(24.11)
Reliance Strategic Investments Limited	(0.04)	(0.06)	(0.02)
Reliance Infrastructure Limited	(0.01)	(0.01)	(0.01)
Reliance Technologies	(0.11)	(0.29)	(6.28)
Reliance Nutraceuticals Private Limited	(0.00)	(0.00)	(0.00)
Reliance Pharmaceuticals (India) Private Limited	(0.00)	(0.00)	(0.00)
Reliance Retail Limited	(0.01)	(0.01)	(0.01)
Petronet India Limited	(14.74)	(43.88)	10.81
Petronet VK Limited	(174.60)	(550.49)	22.63
Petronet CI Limited	(107.91)	--	--

Details of the profits/(losses) incurred by other Promoter Group companies for previous financial years are as given below:

Amount in Rs. million

Company	Year ended March 31, 2005	Year ended March 31, 2004	Year ended March 31, 2003
Reliance Netherlands B.V.	18.02	(2.57)	(0.02)

Company	Year ended March 31, 2005	Year ended March 31, 2004	Year ended March 31, 2003
Trevira Holding GmbH	(1200.41)	(2833.410)	(1113.32)

Overview

They are a start-up company, formed to set up a greenfield petroleum refinery and polypropylene plant (the “Project”) to be located in a Special Economic Zone in Jamnagar in the state of Gujarat in western India. Their proposed refinery and polypropylene plant will be located adjacent to the existing refinery and petrochemicals complex of their Promoter, Reliance Industries Limited (“RIL”), the largest private sector company by market capitalisation in India with assets of Rs. 806 billion (approximately US$ 18 billion) as of March 31, 2005. RIL is the only private sector company from India to feature in the

Fortune Global 500. They will be 80% owned subsidiary of RIL after the Issue. They have not yet commenced business operations. They have developed plans to construct a refinery with a complexity of 14.0, as measured using the Nelson Complexity Index. The refinery will have a total atmospheric distillation capacity of approximately 580 kilo barrels per stream day (“KBPSD”). The polypropylene plant will have a capacity to produce 0.9 million metric tonnes per annum (“MMTPA”). The Project was initially contemplated to be set up by RIL which subsequently decided to implement the Project through us. The capital cost of the Project is estimated at Rs. 270 billion (approximately US$ 6 billion). They propose to fund the Project through debt of Rs. 157.5 billion (approximately US$ 3.5 billion) and equity of Rs. 112.5 billion (approximately US$ 2.5 billion), including proceeds from the Issue. Any additional equity raised in excess of Rs. 112.5 billion will be used as additional contingency for the Project. They have entered into a preliminary term sheet with certain banks and financial institutions to provide for a syndicated term loan facility for approximately Rs. 67.5 billion (US$ 1.5 billion). They intend to seek additional financing through export credit agencies for approximately Rs. 45 billion to Rs. 67.5 billion (US$ 1 billion to

US$ 1.5 billion). They anticipate raising further debt funding of approximately Rs. 22.5 billion to Rs. 33.75 billion (US$ 500 million to US$ 750 million) in accordance with the funding requirements for the Project, as they arise. Their intention is to complete construction and commission the refinery and the polypropylene plant in, or around, December 2008. They have entered into agreements with Bechtel France S.A.S (“Bechtel”) to license the technology for the major process units of the refinery and polypropylene plant. Bechtel will also provide engineering, project management and other

construction services for the Project. RIL has proven expertise in building and operating a large refinery and petrochemicals complex. Its existing refinery, currently the third largest refinery in the world by atmospheric distillation capacity, was built in 36 months and commenced commercial production during 2000. This refinery has operated at near 100% utilisation during its five years of operations, consistently outperforming the average utilisation rate of refineries in the Asia Pacific region, the European Union and

North America as reported by PEL Market Services, Biannual Refining Report, July 2005. With a Nelson Complexity Index of 11.3, the existing refinery has achieved Gross Refining Margins (“GRMs”) that are consistently higher by US$ 2 to US$ 3.6 per barrel than the benchmark Singapore Margins during this period. In 2005, RIL was named the “International Refiner of the Year” by the Hart Energy Publishing LP. It was ranked number one in “Energy Performance” amongst large complex

refineries in the Asia Pacific Region in the Solomon Benchmarking Survey, by Solomon Associates of USA in 2003. The proposed refinery and polypropylene plant is being set up in RPL as in the opinion of the Board of RIL,it is in the interest of all stakeholders. Their proposed refinery and polypropylene plant is being set up in will be located in a Special Economic Zone (the “SEZ”) and will receive certain tax benefits and concessions under SEZ regulations, subject to certain conditions. For further information on the SEZ, see “Regulations and Policies—The Special Economic Zone”

Our Key Competitive Strengths

They believe that their proposal to construct and operate a refinery and polypropylene plant benefits from the following competitive strengths:

_ RIL’s (our Promoter’s) superior project execution skills in constructing a complex refinery: One of RIL’s core

competences is to conceptualise and implement multi-billion dollar projects on time and in a cost efficient manner. RIL has proven track record of successfully implementing large projects, including its existing refinery and petrochemicals complex at Jamnagar in Gujarat, its petrochemicals complex at Hazira in Gujarat and another petrochemicals complex at Patalganga in Maharashtra. These three facilities together accounted for approximately 84% of RIL’s gross fixed assets for the year ended March 31, 2005. The implementation of Jamnagar complex required co-ordination among several

external agencies, including technology licensors, equipment suppliers, and construction contractors and involved a large workforce. As RIL is their Promoter, they expect to benefit from its experience and expertise in the construction of their proposed complex refinery.

_ Large and complex refinery capable of using heavier and sourer, low cost crude to produce high quality, premium petroleum products:

Their proposed refinery is designed to have an atmospheric distillation capacity of approximately

580 KBPSD, which would make it the sixth largest refinery globally, based on current capacities. Such a large scale of operations should provide economies of scale, leading to a relatively lower operating cost base. Their proposed refining facilities have been designed to refine a variety of feedstocks with an API gravity ranging from 15 to 50, including lower cost, heavier and more sour crude oils and to produce high quality transport fuels and other higher value added petroleum products which meet the most stringent international environmental requirements, including ultra low sulphur diesel (10 ppm sulphur) and ether (MTBE or TAME) free gasoline for the sophisticated markets of the United States and Europe. It will also be capable of processing bottom-of-the-barrel products such as vacuum residue to yield valueadded

products such as LPG, naphtha, gasoline and diesel. Unlike many refineries, they do not plan to produce fuel oil,

which is a low value product.

_ Benefits of low capital costs: They believe that the proposed refinery will gain from RIL’s prior experience in constructing and operating the Jamnagar refinery, especially in the areas of design and engineering, construction, labour and resource optimisation, greater use of local materials and resources and faster implementation. They expect these factors will result in a significant reduction in the capital cost for the Project and enable us to achieve lower costs per barrel, adjusted for complexity.

_ Strategic location with proximity to crude oil sources and target export markets: Their proposed refinery will be located on the west coast of India in close proximity to the Middle East, the largest crude oil producing region in the world. They expect this to result in lower ship turnaround time and crude freight costs. In addition, their refinery will be located close to the existing port and tank facilities of Reliance Ports and Terminals Limited (“RPTL”), which plans to establish additional port infrastructure capacity to provide us, once their refinery is operational, with the ability to import crude oil in very large crude carriers and to transport refined petroleum products in parcel sizes of up to 150,000 MT of gasoil or gasoline. This port is closer to the Eastern markets as compared to those in the Middle East and is also well located for the markets in the West. They expect that this locational advantage will improve freight economics.

_ Fiscal incentives by virtue of being located in a Special Economic Zone: An SEZ operates as a delineated area which is deemed to be a foreign territory for the purposes of trade operations, duties and tariffs. Being an export oriented refinery, they intend to export the bulk of their production. They will benefit from an income tax deduction on export turnover for a period of five consecutive years following the commencement of commercial operations (with a scaled reduction in income tax deduction for the next five year period and, subject to certain reinvestment conditions, for a third five year period thereafter). They will also be exempt from customs duty for goods and services imported into or exported from the SEZ and also from excise duty on domestic procurement, for the purposes of their authorised operations.

Name of the Promoter	Date of Allotment	Date when made fully paid-up	Consideration (Cash, bonus, kind etc.)	No. of shares	Face Value	Issue Price	%	Lock-in Period
Reliance Industries Limited	December 6, 2005	December 6, 2005	Cash	100,000*	Rs. 10* per Equity Share	10	0.002%	1 year(
Reliance Industries Limited	January 30, 2006	January 30, 2006	Cash	4,300,000	Rs. 10* per Equity Share	10	0.096%	1 year(
Reliance Industries Limited	February 25, 2006	February 25, 2006	Cash	2,695,600,000	Rs. 10* per Equity Share	10	59.902%	1 year(

Promoters Contribution

Name of the Promoter	Date of Allotment	Date when made fully paid-up	Consideration (Cash, bonus, kind etc.)	No. of shares	Face Value	Issue Price	%	Lock-in Period
Reliance Industries Limited	To be allo- tted simul- taneously with allot- ment in the issue #	Not Applicable	Cash	900,000,000***	Rs. 10* per Equity Share	10	20.000%	3 year(

Global Oil Markets

Oil is one of the world’s most significant sources of commercial energy. It met 37% of the global energy needs of 10,224 million tonnes of oil equivalent (“MTOE”) in 2004 while its nearest rivals, coal and natural gas, met 27% and 24% respectively, as shown in the chart below.

According to the BP Statistical Review of World Energy, June 2005, the Middle East dominates proven reserves of oil, with about two-thirds of the estimated 1,189 billion barrels of the world’s proven reserves. Saudi Arabia (263 billion barrels), Iran (133 billion barrels) and Iraq (115 billion barrels) are the three largest holders of proven oil reserves in the world. The three largest producers of oil, including natural gas condensates, in the world are: Saudi Arabia (10.6 million barrels per day), Russia (9.3 million barrels per day) and the United States (7.2 million barrels per day).

Global Oil Refining Industry Introduction

The oil refining industry is a global business because crude oils, other feedstocks and refined petroleum products can be transported at a relatively low cost by sea and by pipeline and there is worldwide demand for such products. The principal factors affecting refining margins are the demand for and prices of refined petroleum products relative to the supply and cost of crude oils and other feedstocks and the configuration, capacity and utilisation rates of refineries. The range and quality of refined petroleum products produced by any given refinery depends on the types of crude oil used as feedstock and the configuration of the refinery. Light and sweet crude oils are more expensive and generate greater

yields of higher value refined petroleum products, such as gasoline, aviation fuels and diesel. Heavier and sourer crude oils are less expensive and generate greater yields of lower value petroleum products, such as fuel oils. The configuration of certain refineries, particularly in North America, is typically oriented towards the production of gasoline whereas the configuration of refineries in most of the other regions is typically oriented towards the production of middle distillates, such as diesel and aviation fuels. In addition, there are refineries which are configured towards certain other specialty products, such as base oils, naphthenics and bitumen. Oil refineries can generally be divided into two principal categories:

simple hydroskimming refineries and complex refineries. Simple hydroskimming refineries primarily carry out the distillation process while complex refineries carry out two additional functions, conversion of hydrocarbon fractions produced in the crude distillation process to other products and the treatment of intermediate products to create higher value-added products. Consequently, simple refineries produce lower value petroleum products than complex refineries for any given mix of crude oil feedstocks.

Crude Oil Qualities

Crude oil quality is measured in terms of density (light to heavy) and sulphur content (sweet to sour). Density is classified by the American Petroleum Institute (‘‘API’’). API gravity is defined based on density at a temperature of 15.6 degrees centigrade. The higher the API gravity is, the lighter is the crude oil. Light crude oils are generally those with an API gravity of 33 degrees and above, while heavy crude oils have an API gravity of 29 degrees or less. The crude oils with API gravity between 29 and 33 degrees are generally referred to as medium crude oils. With respect to sulphur content, sweet crude oil is commonly defined as crude oil with sulphur content of less than 0.5 percent while sour crude oil has sulphur

content of greater than 0.5 percent.

The quality of crude oil and other feedstocks dictates the level of processing and conversion necessary to achieve an optimal mix of finished products. Light sweet crude oils are more expensive than heavier and sourer crude oils because they require less treatment and produce a slate of products with greater percentage of value-added, light refined petroleum products such as gasoline, aviation fuels and diesel. The heavier and sourer crude oils typically sell at adiscount to the lighter and sweeter crude oils because they produce a greater percentage of lower value-added products with simple distillation and require additional processing to produce the higher value, light products. Consequently, refiners strive to process the optimal mix, or slate, of crude oils through their refineries, depending on each refinery’s conversion and treating capacity, the desired product output and the relative prices of available crude oils.

Crude oil pricing is a function of many variables. As outlined above, the most important variables are the API gravity and the sulphur content in the grade. All grades of crude oil are sold at a differential to what are known as marker grades. For each geographical region, there are established marker grades, e.g. Brent for the North Sea and West African markets, WTI for North American markets and

Oman and Dubai for East of Suez markets. These differentials vary from time to time depending on a variety of factors like relative production levels of light/sweet and heavy/sour crude oils, product specifications and price margin spreads between different products. For example, when price spreads between higher value distillates and lower value fuel oil are high, the lighter and sweeter crude oils trade at a larger differential to heavier and sourer crude oils.

Overview of Refining Processes

Crude oil is refined into a wide variety of intermediate and final products. In general, the process units in a refinery perform three different functions:

_ separate by distillation the many types of hydrocarbons present in crude oil and other feedstocks;

_ chemically convert some of the lower valued fractions into more desirable products; and

_ treat intermediate products by removing unwanted elements and compounds for blending into final end products.

Each step in the refining process is designed to maximise the value added to its inputs. Most simple refineries carry out only the first function, crude distillation, while more complex refineries also perform the other two functions, conversion of hydrocarbon fractions to other products and treatment of intermediate products. The following description outlines the refining process of a typical complex refinery.

Distillation. The first refinery unit to process raw crude oil is the atmospheric distillation unit. Crude oil is separated by boiling in the distillation units under high heat and recovered as hydrocarbon fractions. The lowest boiling fractions, including LPG and naphtha, vaporise and exit the top of the atmospheric distillation unit. Medium boiling liquids, including kerosene, which is used for aviation fuels, and distillates such as diesel oil and heating oil, are drawn from the middle of the distillation unit. Higher boiling liquids, called atmospheric distillation residues, are drawn together from the bottom of the atmospheric distillation unit and further separated into vacuum gasoil under low pressure in the vacuum distillation unit. Vacuum residues can be upgraded to light and middle distillates or used for fuel oil and bitumen production. The

various fractions are then pumped to the next appropriate unit in the refinery for further processing into higher valueadded products.

Refining Industry Characteristics

Economics of oil refining

Oil refining is primarily a margin-based business in which a refiner’s goal is to optimise the refining processes and yields of all products in relation to feedstocks used. In a simple refinery, a greater percentage of the end products are less valuable heavy products such as fuel oil, long residue and bitumen. Complex refineries generally produce a lower percentage of these heavy products and produce a higher percentage of light products such as LPG, naphtha and gasoline and middle distillates such as kerosene and diesel. The total value of the finished products less the cost of crude oil and other feedstock is commonly referred to as the gross refining margins (“GRMs”). The GRMs of complex refineries are higher than those of simple refineries because complex refineries are able to generate a higher yield of light and middle distillates from lower cost heavier and sourer crude oils. In addition, a lower proportion of lower value heavy products are produced in a complex refinery because they have secondary

processing facilities available to convert these products into the higher value light products.

Crude oil typically accounts for 90% to 95% of the total cost of refining. Because other operating expenses are relatively fixed, the goal of refineries is to maximise utilisation rates, maximise the yields of higher value-added products, minimize feedstock costs and minimise operating expenses.

Location of oil refineries

The location of an oil refinery can have an important impact on its refining margin since the location influences its ability to access feedstocks and distribute its products efficiently. The location dictates what proportion of the feedstocks and products can be transported by tanker vessels by sea or via pipelines, rail or tank trucks. Refining companies seek to maximise their profits by placing their products in the markets where they receive the highest returns after taking into account delivery transportation costs and other expenses such as import duties in those markets. Due to their flexibility and lower logistics costs, coastal refineries typically have a competitive advantage over the oil refineries located inland. In

some cases, oil refiners situated in areas of high petroleum product consumption enjoy a comparative advantage with respect to satisfying the local demand.

Crude Oil Supply

As shown in the table below, in 2004, the global oil supply was estimated by the International Energy Agency (“IEA”) to be 82.1 million barrels per day. The Middle Eastern OPEC countries accounted for 27.8% and total OPEC countries accounted for 39.5% of this supply. IEA estimates that by 2020, global oil supply may reach 104.9 million barrels per day with Middle Eastern OPEC countries accounting for 33.7% and total OPEC countries accounting for 45.2%.

The Refinery Project

Global size, complex refinery

We are proposing to construct and operate a refinery that will have an atmospheric distillation capacity of approximately 580 KBPSD with an expected complexity of 14.0 as measured using the Nelson Complexity Index. The Project would also comprise of a 0.9 MMTPA polypropylene plant.

Their proposed refinery would be the sixth largest in the world based on the current global ranking of refineries by the industry publication, Oil and Gas Journal, December 2005. The proposed facility is designed to be a highly complex refinery with significant secondary processing facilities designed to maximise the quantity of value added products such as propylene, alkylates, jet fuel and diesel.

Refining process

The following chart sets out the refining process of crude oil and other feedstocks into refined petroleum products that will be followed at their proposed refinery. For further information on the refining process, see “Industry Overview — Overview

of Refining Processes and Products”.

The salient features of their proposed refinery’s process configuration are highlighted below.

There are two trains each of crude distillation units (“CDU”) and vacuum distillation units (“VDU”). Virtually any grade of crude can be processed in the CDUs and VDUs where crude oil is separated into its components, namely gas, C3/C4 (saturated liquefied petroleum gas (“LPG”)), naphtha, light kerosene (“LK”), heavy kerosene (“HK”), atmospheric gas oil (“AGO”), vacuum gas oil (“VGO”) and vacuum residue (“VR”). The crude and vacuum distillation units are integrated for energy efficiency. The C3/C4 mix goes to the alkylation unit. The unconverted C3 is sold as propane. The naphtha is split into light and heavy naphtha. The heavy naphtha is hydrotreated in the heavy naphtha hydrotreater unit (“HNHT”) from where it goes to the continuous catalytic regeneration platformer. The platformer converts naphtha

into reformate, a high-octane gasoline component. The majority of light naphtha is upgraded into gasoline. Light kerosene undergoes jet blending with 0.2% sulphur. Heavy kerosene and gas oil is desulphurised in two trains of diesel hydro desulphurisation units (“DHDS”) to produce 10

parts per million (“ppm”) sulphur diesel. Vacuum gas oil is hydrotreated in two trains of VGO hydro treating units (“VGOHT”) to improve the quality of feedstock for FCC. Hydro treated VGO is fed to a high-severity FCC. Hydrogen, required for hydro-treatment of various streams, is produced in hydrogen manufacturing units (“HMU”).

VR is thermally cracked in a delayed coker unit (“Coker”). The coker products such as light coker gas oil (“LCGO”) and heavy coker gas oil (“HCGO”) are further treated in DHDS and VGOHT units respectively. Coke is the final product from the coker. The coker allows minimising fuel oil production. The fluid catalytic cracking unit (“FCC”) is the principal refinery unit to maximise gasoline and propylene. The FCC cracks hydro treated VGO from VGOHT to produce components like gas, C3/C4 (unsaturated LPG), gasoline, light cycle oil (“LCO”) and clarified slurry oil (“CSO”). C3/C4 from the FCC goes to the propylene recovery unit (“PRU”). Recovered propylene is converted into polypropylene (“PP”). The C4 stream from the PRU is the primary feed to the alkylation unit. The alkylation unit converts C4 into alkylate, a premium gasoline component. Alkylate is either sold as a product or used to upgrade naphtha into gasoline. The butamer unit isomerises C4 to supplement the feed to the alkylation unit. The gasoline from the FCC is hydro treated in the scanfiner unit to produce 10 ppm sulphur gasoline. LCO from the FCC is unsuitable for blending into premium diesel. So, it is cracked in the LCO hydrocracker unit (“LCO

HC”) to convert it into a diesel blend stock. A post treating unit (“PTU”) is added to the configuration to upgrade the diesel properties of density and cetane. The PTU will allow their refinery to produce 100% of the diesel pool as 10 ppm sulphur EURO IV diesel, a premium grade.

Technology Licensing

The configuration of the proposed refinery has been designed by a joint team of experts from RPL, RIL, its Affiliates, Bechtel and UOP LLC (“UOP”). It is similar to that of RIL’s existing refinery at Jamnagar.

Encouraged by the successful operations of RIL’s existing refinery, they have decided to use the same licensors as were used by RIL (with the addition of Exxon Mobil Research and Engineering (“EMRE”)) for all of the process units to be built in their refinery. They have selected UOP and EMRE as the technology licensors for the proposed refinery.

They have an agreement with Bechtel (as an authorised licensee of UOP) for certain technologies relating to major units of the refinery including the crude distillation unit, hydrotreater, catalytic reforming unit, fluid catalytic cracking unit and the delayed coker unit (using Foster Wheeler technology). In addition, UOP has been appointed as the managing licensor for the refinery, responsible for providing, among other things, the capacity rating for the equipment, the integrated optimization model and the operating and consumption guarantees. UOP is a leading licensor of refinery and petrochemicals technologies in the world with substantial experience in the area, having provided licenses to more than 700 refineries globally. RIL has licensed technology from UOP for its paraxylene plant at Patalganga and its existing refinery at Jamnagar. EMRE will be the technology licensors for the alkylation and butamer units. EMRE is a Virginia (USA) based leader in petroleum refining technology and has licensed technology to more than 60 greenfield refineries and over 1,000 refining units.

Implementation Strategy

Bechtel has been given the single point responsibility for the implementation of the Project. It will provide detailed engineering, project management, site support and construction supervisory services as well as the offshore supply of equipment and bulk materials for the Project. They will also utilise RIL and its affiliates for construction services. They expect that this will enable us to leverage local construction and project implementation capabilities while utilising Bechtel’s technical, project management and engineering expertise. Bechtel’s services will be provided pursuant to six separate, but inter-related agreements as outlined below (the “Bechtel Agreements”). Under the Bechtel Agreements, Bechtel has no liability for consequential damages or any loss of profits that they may suffer as a result of its failure to perform. Bechtel may, pursuant to all of the Bechtel Agreements (except the License and Basic

Engineering Agreement) seek an adjustment to the Project’s schedule where a force majeure event has occurred, such as an act of war or terrorism or a strike by a national category of workers if such an event lasts longer than five days, or 20 days in the aggregate should there be a number of such events. The Bechtel Agreements are governed by the laws of India, with disputes to be settled by binding arbitration.

The following is a brief summary of the services provided under the Bechtel Agreements:

_ Umbrella Services Agreement: Bechtel is responsible for the achievement of certain performance standards and the establishment of parameters for yield, capacity, utility consumption, quality, safety and statutory and environmental

standards. They are obligated, under this agreement, to effect a “marine-and-erection” insurance policy, the details of which are discussed below under “–Insurance”.

_ License and Basic Engineering Agreement: Bechtel (with authority from UOP as its licensor) grants process licenses and provides basic engineering services for certain refinery and polypropylene units, including providing us with design specifications, process technology, know-how and technical information for refinery and polypropylene process units other than the EMRE refinery units.

_ Engineering Services Agreement: Bechtel is required to provide the detailed design and engineering for the Project overall, including the preparation and supply of engineering information in sufficient detail for the procurement of equipment, materials, civil and environmental engineering services and other general engineering services in connection with the construction, operation and maintenance of the refinery and polypropylene plant.

_ Equipment Supply Agreement: Bechtel will supply the basic equipment necessary to design, construct and operate the refinery and polypropylene plant. Bechtel will also arrange to supply and furnish all general arrangement drawings, manufacturers’ catalogues and other literature relevant to the equipment prior to the date of shipment in each case.

_ Site Services and Assistance Agreement: Bechtel is required to provide technical assistance in relation to the construction and commencement of operations for the Project. In particular, Bechtel’s responsibility includes providing technical assistance in connection with the erection of all items of equipment, the construction of process units, utilities and offsite facilities, testing and start-up of the project during six months prior to the start-up date and up to 12 months

after the start-up date.

_ Project Management Services Agreement: Bechtel will provide overall project management services including the management, monitoring and reporting with respect to the implementation of the Project, timely assessments, the periodic monitoring of all factors likely to affect the Project’s schedule or quality and recommending, instituting and implementing remedial actions in connection with each of the foregoing. Bechtel will also gather and prepare project documentation, render construction advisory services such as the administration of construction contracts, the coordination, inspection, management and monitoring of the work of contractors and the preparation of progress reports. In addition to these agreements, RIL has also entered into three license and engineering agreements with EMRE (the

“EMRE Agreements”) to upgrade various processes that can add value to the products and to enable such products to meet stringent quality specifications. They have requested RIL to assign the EMRE licenses to us in connection with their refinery and polypropylene plant.

Operational support services by RIL

Crude Oil and Other Feedstock Procurement

They intend to enter into long-term contracts with RIL for the provision of procurement services for crude oil and other feedstocks. They hope to leverage RIL’s experience and expertise in procurement of crude oil and other feedstock for its existing refinery, which has been operating at near 100% utilisation since it commenced operations in 2000. RIL currently procures approximately 660 KBPSD of crude oil for its existing refinery from various suppliers in the Middle East, West Africa and Latin America, through a combination of term contracts and spot purchases. The term contracts give RIL partial

security of supply. When operations begin at their proposed refinery, its requirements for crude oil combined with the requirements for RIL’s existing refinery will be nearly double of RIL’s current requirements. They will rely on RIL to provide us crude oil procurement services. They understand from RIL that, in line with existing practice, the crude oil for both refineries will continue to be procured through a combination of term contracts and spot purchases. They believe that this procurement strategy will lead

to lower costs of procurement due to synergies in terms of higher economies of scale in purchasing, better negotiating power and enhanced flexibility in scheduling. Although, since commencing operations at its existing refinery in 2000, RIL has stheirced the majority of its crude oil supply from the Middle East, RIL has also procured certain quantities of its crude oil supply from outside the Middle East. The

extent of such supply is driven by economic and strategic needs. The grades of crude oil from outside the Middle East,

such as grades from West Africa and South America, are procured partly on term contracts and partly on a spot basis. They propose to adopt a similar strategy for meeting their crude oil requirements, with RIL providing the necessary procurement services. For a complex refinery such as their proposed refinery, with the ability to process many grades of crude oil, an optimal volume of spot procurement offers additional value enhancing opportunities. Spot volumes will give us the ability to adjust their crude mix to ever-changing market dynamics and also enable us to manage any unplanned refinery problems in a better

manner. Under operating conditions, the feedstock mix will consist of several varieties of crude oil depending on market conditions and price differentials between the heavier and lighter crude varieties.

The proposed refinery will require catalysts and other chemicals for various production processes. Catalysts are procured from a variety of international suppliers. All other chemicals are also freely available in global markets.

Reliance Petroleum Limited

Outstanding Litigation

(A) Against their Directors

Criminal Cases filed against Mr. Mukesh D. Ambani

_ There are eleven criminal cases which have been filed against their Director, Mr. Mukesh D. Ambani amongst others. The details of the same are as provided below:

a) For non conversion of Optionally Fully Convertible Debentures (“OFCDs”) issued by the erstwhile Reliance Polypropylene Limited, Mr. Santosh Tyagi, a holder of the OFCDs, filed a criminal case before the Special Court for Economic Offences, Jaipur, under Section 63 of the Companies Act alleging that false statements have been made in the prospectus pertaining to the issue of OFCDs. The Special Court for Economic Offences took cognizance of the offences alleged and issued summons interalia to Mr. Mukesh D. Ambani. Against the order of the Special Court for Economic Offences taking cognizance, the accused filed a Revision Petition before the Sessions Court, Jaipur, which is pending disposal.

b) For non conversion of OFCDs of the erstwhile Reliance Polyethylene Limited, Mr. Jairam Jangid has filed a criminal case before the Special Court for Economic Offences, Jaipur, under Section 63 of the Companies Act alleging that false statements have been made in the prospectus pertaining to the issue of OFCDs. The Special Court for Economic Offences took cognizance of the offence alleged and issued summons interalia to Mr. Mukesh D. Ambani. Pending disposal of a petition for quashing filed by the accused, the High Court of Rajasthan has stayed the proceedings before the Special Court for Economic Offences, Jaipur.

c) For alleged non receipt of the shares in the erstwhile Reliance Polypropylene Limited and Reliance Polyethylene Limited sent for transfer in 1994, to the then registrar and transfer agents of RIL on a complaint filed by one Mr. Bhanwarlal Bothra, the Chief Judicial Magistrate took cognizance of the offences alleged and issued summons inter alia to RIL and Mr. Mukesh D. Ambani under Section 406 and 420 of the Indian Penal Code (“IPC”). Pending disposal of a petition for quashing filed by the accused, the High Court of Patna has stayed the proceedings before the Chief Judicial Magistrate, Patna.

d) For the alleged non transfer of 200 share in the erstwhile Reliance Petroleum Limited, on a complaint filed by one Mr. Bharat Bhushan Singh, the Chief Judicial Magistrate, Patna has taken cognizance of the offences alleged and issued summons, inter alia, Mr. Mukesh D. Ambani under Section 403 and 420 read with section 120-B of IPC. Pending disposal of a petition for quashing filed by the accused, the High Court of Patna has stayed the proceedings before the Chief Judicial Magistrate, Patna.

e) On a complaint filed by one Mr. Bhupinder Singh, the Chief Judicial Magistrate, Hissar issued summon

interalia to Mr. Mukesh D. Ambani under Section 406 & 420 of the IPC. In the complaint it is alleged that the complainant was not provided with the mobile phone service although his cheques for deposit and rentals were encashed. Pending disposal of a petition for quashing filed by Mr. Mukesh D. Ambani, the Punjab and Haryana High Court has stayed the proceedings before the Chief Judicial Magistrate, Hissar.

On a complaint filed by one Ms. Shobha Jha, the Chief Judicial Magistrate, Patna issued summons inter alia to Mr. Mukesh D. Ambani under Sections 465, 467, 468, 469, 471 and 120(B) of the IPC. In the complaint it is alleged that although the complainant is not a subscriber of Reliance India Mobile phone, she was receiving bills for usage of the phone. Pending disposal of a petition for quashing filed by the accused, the High Court of Patna has stayed the proceedings before the Chief Judicial Magistrate, Patna.

g) On a complaint filed by one Mr. Ravi Fogla, the Additional Chief Metropolitan Magistrate, Kolkata issued summons inter alia to Mr. Mukesh D. Ambani under Sections 385, 420, 511 and 120(B) of IPC. In the complaint it is alleged that although the complainant is not a subscriber of Reliance India Mobile phone, he was receiving bills for usage of the phone. Pending disposal of a petition for quashing filed by the accused, the Calcutta High Court has stayed the proceedings before the Additional Chief Metropolitan Magistrate, Kolkata.

h) On a complaint filed by one Mr. Suresh Pal, the Chief Judicial Magistrate, Kurukshetra issued summons inter alia to Mr. Mukesh D. Ambani under Sections 420, 467, 468, 471 and 120(B) of IPC. In the complaint it is alleged that although the complainant is not a subscriber of Reliance India Mobile phone, he was receiving bills for usage of the phone. Pending disposal of a petition for quashing filed by the accused, the Punjab and Haryana High Court has stayed the proceedings before the Chief Judicial Magistrate, Kurukshetra.

i) On a Complaint filed by one Mr. Prafulla Kumar Mishra, the Sub Divisional Judicial Magistrate, Uditnagar issued summons, inter alia, to Mr. Mukesh Ambani under sections 199, 406, 409, 418, 420, 427, 468, 477 and 34 of IPC. In the complaint it is alleged that the Complainant, a subscriber of Reliance India Mobile Phone was provided defective handset and deficient services. It is also alleged that although complainant was not using the mobile phone, he continued to receive the bills in respect of the mobile phone. Pending disposal of the Petition for quashing filed by Mr. Mukesh Ambani, the Orissa High Court has stayed the proceedings before the Sub Divisional Judicial Magistrate, Uditnagar.

j) On a complaint filed by one Mr. Anil Kumar, the Chief Judicial Magistrate, Patna issued summons inter alia to Mr. Mukesh D. Ambani under Sections 419, 420, 468, 469, 34 and 500 of IPC. In the complaint it is alleged that although the complainant is not a subscriber of Reliance India Mobile phone, he was receiving bills for usage of the phone. Pending disposal of a petition for quashing filed by the accused, the High Court of Patna has stayed the proceedings before the Chief Judicial Magistrate, Patna.

k) On a complaint filed by one Mr. Parasmal Choradia, the Chief Judicial Magistrate, Raipur issued summons inter alia to Mr. Mukesh D. Ambani under Sections 420, 465, 468 and 474 of IPC. In the complaint it is alleged that Mr. Mukesh D. Ambani (as Chairman of Reliance Telecom Limited) and an official of Reliance Telecom Limited forged certain document and changed the tariff plan of the complainant. Pending disposal of a petition for quashing filed by the accused, the High Court of Chhastigarh has stayed the proceedings before the Chief Judicial Magistrate, Raipur.

As per Website Details

About Us:

They are a start-up company, formed to set up a greenfield petroleum refinery and polypropylene plant to be located in a Special Economic Zone in Jamnagar in the state of Gujarat in western India. Their proposed refinery and polypropylene plant will be located adjacent to the existing refinery and petrochemical complex of their Promoter, Reliance Industries Limited (“RIL”), the largest private sector company in India with assets of over Rs.806 billion (approximately US$ 18 billion) as of March 31, 2005.

RIL is the only private sector company from India to feature in the Fortune Global 500.

CMT REPORT [Corruption, Money laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.46.20
UK Pound	1	Rs.84.57
Euro	1	Rs.58.12

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	2
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	3
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	-
--PROFITABILIRY	1~10	-
--LIQUIDITY	1~10	4
--LEVERAGE	1~10	4
--RESERVES	1~10	4
--CREDIT LINES	1~10	4
--MARGINS	-5~5	-
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		26

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions