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Reliance to buy 60% stake in US venture

  • Agencies
  • Aug 05, 2010, 10:01 AM IST
Washington: Reliance Industries will pay $392 million to take a 60 percent interest in a joint venture with Carrizo Oil & Gas , its third shale gas acquisition in the United States this year.

Reliance, controlled by billionaire Mukesh Ambani, will pay $392 million, comprising of $340 million of cash and $52 million for developing assets in the booming Marcellus Shale gas project.

The $52 million will provide for 75 percent of Carrizo's share of development costs over an anticipated two year development programme, India's largest listed conglomerate said in a statement on Thursday.

The deal is expected to close by mid-September.

In June, Reliance Industries said it will invest $1.36 billion in the U.S. shale gas assets of Pioneer Natural Resources, and in April, the company said it will pay $1.7 billion to form a joint venture at the Marcellus Shale region with Atlas Energy.

The latest joint venture will have about 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 about 62,600 net acres.

Carrizo will serve as the development operator for the joint venture and Reliance has the option to act as a development operator in certain regions in the coming years as part of the joint venture, the Indian firm said.

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