Reliance Industries, India’s biggest company by market value, said it is reviewing global opportunities for growth in its core business after a report that it had bid for a Canadian company with oil-sands assets. 'The difficult operating environment of the past year has made available several interesting opportunities,' Reliance said after CNBC television reported it made a $2 billion offer for Value Creation Inc.

The statement was similar to one released in November amid speculation Reliance had bid for bankrupt chemicals and fuels maker LyondellBasell Industries AF. Reliance, which confirmed the LyondellBasell bid two weeks later, submitted an expression of interest in the past 10 days to the privately held Calgary- based company, which is looking to raise funds to settle with lenders, CNBC reported, without saying where it got the information.

'Reliance should spread its wings in exploration as much as it can' to tap into more overseas production assets, said Vinay Nair, a Mumbai-based analyst with Khandwala Securities. 'For that purpose, the probability of discovery in a place like Canada is better than some.'

Energy companies have begun to extract heavy oil from tar sands in countries including Canada and Venezuela as advances in technology and higher crude prices make production feasible. Some have faced protests from environmental activists over the release of greenhouse gases from such projects. PetroChina Co., China’s largest oil company, won Canadian government approval in December for a C$1.9 billion bid to buy a 60 percent share in Athabasca Oil Sands Corp.’s MacKay River and Dover oil-sands projects.

Value Creation is developing a project to extract and upgrade bitumen from oil sands at a site in Alberta that is expected to produce 8,400 barrels a day of upgraded oil products over 25 years, according to its web site. First production is expected in 2011, it says.

Reliance, controlled by billionaire Mukesh Ambani, plans to expand globally and has said it may buy oil fields in the Gulf of Mexico and Brazil. Reliance holds overseas blocks in Peru, Yemen, Oman, Iraq, Colombia, East Timor and Australia. One block in Yemen is producing 4,400 barrels a day, according to Reliance’s earnings statement for the three months ended Dec. 31.

Reliance said in November it made a non-binding, cash offer for a controlling interest in LyondellBasell, which also has oil refineries in Houston and France.

Greenpeace has said it takes three to five times more energy to extract oil from sands than it does to produce conventional crude. Planned tar-sands projects in Alberta will increase greenhouse-gas output to as much as 140 million metric tons a year by 2020, about the same as Belgium’s current emissions, according to the organization.

Alberta has no plans to slow the pace of oil-sands development and will be working to ensure the infrastructure can meet future demands as new projects attract people and investment, the energy ministry said Jan. 15.

Suncor Energy Inc., Canada’s largest oil company, said Alberta’s oil sands are increasingly important as a supplier of energy. About 42 percent of Suncor’s production comes from the oil sands, the world’s second-biggest crude reserves after Saudi Arabia’s.

Source: Bloomberg