BP (BP.L) has announced $7.2 billion (£4.4 billion) deal to acquire a stake in 21 oil & gas production sharing contracts owned by Indian company Reliance Industries.

The acquisition of a 30 per cent stake in the contracts is part of a 'planned alliance' to operate the gas value chain in India.

The deal is believed to be among the largest foreign direct investments in India, ad could lead to further performance payments of $1.8 billion (£1.1 billion), dependent on exploration success leading to commercial discoveries.

Mukesh Ambani, chairman and managing director of Reliance Industries, said, 'The alliance with BP will boost our efforts to realize the true potential of India's hydrocarbon reserves.

'The globally renowned expertise of BP and the in-depth domestic experience of Reliance make for a formidable alliance which will deliver unparalleled value for the country in its pursuit of energy security.'

Bob Dudley, group chief executive of BP, said the deal was part of its strategy to create alliances with 'strong national partners'.

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