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Reliance Plans To Expand World’s Largest Refinery Complex; What Does The Chart Says??

Reliance plans to expand World’s Largest Refinery Complex; what does the chart says??

Reliance Industries Ltd. is considering a plan to boost its oil-refining capacity by about half, according to Bloomberg report. The proposed plant is  expected to come up at the world’s biggest refining complex in Jamnagar and will be able to process as much as 30 million tons of crude a year.

Reliance

Reliance has begun discussions with global refinery process licencors and equipment vendors for the new refining train at the Jamnagar complex. The plant of the size planned by the company may cost $10 billion.

Reliance is looking to process the dirtiest and heaviest crude and may focus on producing feed-stock for petrochemicals. The expansion plan is still under discussion and hasn’t been finalized. A feasibility report is likely to be prepared by the end of next year, once the recently-expanded petrochemicals capacities stabilize, and Reliance is expected to make the final investment decision with an aim to start work in 2020.

  • Saudi Aramco and ADNOC signed agreements to invest in a proposed 60-million ton refinery complex on India’s west coast.
  • Rosneft and partners acquired the country’s second-largest private oil processor.
  • Shell has restarted retailing gasoline and diesel in the country.
  • Total partnered the Adani Group to set up liquefied natural gas import terminals and fuel retailing business.
  • Last year, BP Plc expanded its partnership with Reliance to retail auto fuels.

Reliance had considered expanding its refining capacity in the past. And in 2013-14 it sought environment approval for the project. Reliance didn’t move ahead with the plan as it focused on increasing downstream chemicals capacities and building the telecom business.

Reliance

Reliance was seen within tight range for couple of years from 2009 to 2017. Momentum indicators sustained in a band and indicated a sideways action throughout as RSI was restricted between 40-60 range whereas DI lined below neutral zone of 25. The range expansion witnessed around mid of 2017 was supported by strength in momentum. Price breakout with RSI shifting range to higher levels and DI+ line breaking above neutral zone produced thrust and rally was visible. Reliance thereafter has been on a steady uptrend and has seen corrective pattern in intermediate period. Recent correction from the peak zone has led price to fall towards the recent previous sideways action and stock has sustained above it. This has produced some demand and recover above the TS line on monthly timeframe charts. The steady trend-line active from the lows of Feb 2017 at the recent swing lows acted as additional evident of supports. With the current corrective move, the momentum damage was seen on higher degree as compared to price action as RSI dips back to 60 zone. Lower timeframe RSI has sustained around 40 zone with DI line below neutral zone awaits fresh upside momentum to emerge and shows higher probability of low volatility breakout. Currently, Reliance is trading at resistance of flat TS line of Ichimoku on weekly timeframe, breaking which stock is expected to challenge the peak zone. On the other hand, supports are intact at the rising trend-line.

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