Reliance had between 2010 and 2013 invested in the US shale gas assets, buying stakes in 3 upstream oil exploration joint ventures.
Delaware, February 5 - Neftegaz.RU. Reliance Marcellus, a wholly-owned subsidiary of Indian
Reliance Industries, agreed to sell its stake in the
shale gas asset in south-western Pennsylvania (U.S.) for $250 million. Billionaire Mukesh Ambani-led company signed an settlement with Northern Oil & Gas.
Under the deal, Northern Oil and Gas will pay $175 million in cash and issue approximately 3.25 million warrants to Reliance Industries, allowing the latter to buy 3.25 million common shares of Northern Oil and Gas over the next 7 years at a price of $14 per share.
The deal is predicted to be closed in April 2021.
As of 1 July 2020, the assets were producing nearly 120 million cubic feet of
natural gas equivalent per day (MMcfe/d) of natural gas equivalents, net to Northern Oil and Gas’ ownership. In the current year, the Marcellus shale play assets are estimated to produce around 100-110 MMcfe/d net to the Delaware-based firm.
India´s Reliance had been bullish on shale gas till 2014 before a drop in crude
oil prices hit the valuations of such assets.
Shale gas blocks have suffered far more than conventional oil and gas blocks as they are economically viable only when prices are above a certain threshold.
Delaware-based Northern Oil and Gas is a company with a primary strategy of investing in non-operated minority working and mineral interests in oil & gas properties, with a core area of focus in the premier basins within the United States.
