Reliance to invest $1.36 bln on U.S. shale gas venture

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Old 24-Jun-2010
Reliance to invest $1.36 bln on U.S. shale gas venture

Reliance Industries will invest $1.36 billion in shale assets of Pioneer Natural Resources, as the Indian energy major looks to build its presence in the U.S. shale gas sector.

Under the agreement, Pioneer will sell 45 percent stake in its Eagle Ford shale acreage in south Texas to Reliance for $1.15 billion, the US firm said a statement.

Reliance has also entered into an agreement with Pioneers existing partner in the Eagle Ford Shale play for about $210 million.

The deal is the second of its kind this year for Reliance, a petrochemicals-to-refining giant with a market value of $75 billion.

In April, Reliance agreed to pay $1.7 billion to Atlas Energy to form a joint venture and own a 40 percent stake in Atlas' Marcellus Shale operations in the eastern United States.

Companies from around the globe are increasingly investing in US shale plays -- underground rock formations that hold reserves of oil and natural gas.

Shale gas accounts for between 15 percent and 20 percent of US gas production but is expected to quadruple in coming years, touching off a scramble among producers large and small for access to resources.

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