RIL sells stake in Marcellus Shale to BKV Chelsea for $ 126 mn

MUMBAI: Reliance Industries has announced the completion of the sale of one of its three upstream shale gas assets in the US for $ 126 million to BKV Chelsea, an affiliate of Kalnin Ventures LLC, the Mukesh Ambani-led conglomerate said in a statement.

The deal was announced on October 6.

The asset, namely Marcellus Shale Play, located in north-eastern and central Pennsylvania was operated by Carrizo Oil. RIL had bought 60% stake in it for $392 million in 2010.

"Additionally, under the definitive documents, a contingent amount of up to $11.25 million may be paid to Reliance between years 2018 to 2020 based on certain gas price thresholds being achieved," RIL said in the statement.

RIL acquired shale gas assets in the US through various joint ventures and has thus far invested around $ 2 billion. RIL, like most global energy majors, reduced capital expenditure on the three shale gas joint ventures in the US and the divestment is aimed at easing liquidity position.

Prior to this, in 2015, Reliance Industries and its shale gas joint venture partner Pioneer Natural Resources Company sold their mid-stream pipeline arm EFS Midstream for $2.15 billion to Enterprise Products Partners.

While RIL continues to hold stake in the other two upstream shale gas assets, industry sources believe it may be open to paring its stake even in those address. At the companies Annual General Meet earlier this year, Ambani had said that the company will continue to "rationalise" the shale gas portfolio.