Mukesh Ambani-led Reliance Industries Limited said on Thursday it will acquire 45 per cent stake in US-based Pioneer Natural Resources' shale gas assets in the US for $1.15 billion (around Rs 5,300 crore).
RIL signed agreement to take 45 per cent interest in highly prospective Eagle Ford Shale play, the Mumbai-based firm and Pioneer said in separate but almost identical statements.
Pioneer currently produces about 28 million cubic feet per day from five wells in the 212,000 acres Eagle Ford Shale property.
After the agreement, RIL will own 95,300 acres of this property. RIL will pay $266 million in cash to Pioneer at closing and an additional $879 million to carry Pioneer's share of future drilling costs.
The joint venture agreement between RIL's subsidiary Reliance Eagleford Upstream LP and Pioneer would be effective from June 1, 2010.
Additionally, RIL and Pioneer have executed agreement to form a midstream joint venture that will service to sell the gas produced from the Eagle Ford property.
Reliance Eagleford Midstream will pay $46 million to acquire a 49.9 per cent interest in the joint venture.
RIL executive director PMS Prasad said: "Reliance is very pleased to establish a long-term partnership with Pioneer in the Eagle Ford shale. This transaction represents another significant milestone in Reliance's efforts to grow its North American shale gas operations."
The deal would be RIL's second purchase of a US shale gas interest in as many months. The company had made its first breakthrough in the US in April when it had acquired 40 per cent stake in Atlas Energy Inc's 3,00,000 acres shale gas property for $1.7 billion.
