RIL to buy 60 percent stake in US shale firm for $392 mn

August 5th, 2010 - 2:36 pm ICT by IANS  

Mumbai, Aug 5 (IANS) India’s largest private sector company Reliance Industries (RIL) Thursday said it will invest $392 million to acquire a 60 percent stake in the US-based Pioneer Natural Resources’ shale gas assets in a joint venture with Carrizo Oil and Gas.
Expected to close by mid-September 2010, the deal is RIL’s third shale gas acquisition in the US this year.

The total deal comprises a $340 million cash component and $52 million of drilling carry obligation and provides for 75 percent of the Carrizo’s share of development costs over a two-year period, RIL said in a statement.

In June, the company had announced that it would pay $1.3 billion for a 45 percent stake in US-based Pioneer Natural Resources’ shale gas assets.

The company had bought 300,000 acres of shale gas property from US-based Atlas Energy in April.

The joint venture will have approximately 104,400 net acres of undeveloped leasehold in the core area of the Marcellus Shale in central and northeast Pennsylvania, of which Reliance’s 60 percent interest will represent approximately 62,600 net acres, the company said.

“The proposed joint venture will supplement strengths achieved through our recent joint ventures and further expand our footprint in North American shale gas operations,” said Walter Van de Vijver, President, International Exploration and Production Business, RIL.

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