Following in the footsteps of Reliance Industries, GAIL plans to buy shale gas assets abroad.The state-run company may soon buy nearly 20 per cent stake in two shale gas acreages - Eagle Ford shale and Barnett shale - in the US.
Company executives said GAIL was in talks with the owner of these assets. It would soon work out the offer details and seek a board approval, they said.
The deal size could be over Rs. 1,000 crore (Rs. 10 billion).
A consultant involved in the due diligence confirmed the talks were on.
"The company has been looking for a shale gas asset in the US for some time. It plans to build some expertise in shale gas technology. This may help it bid in shale gas rounds as and when the Indian government launches these auctions," a company executive said on condition of anonymity.
The Eagle Ford shale is located in multiple destinations in South Texas while Barnett is the largest onshore natural gas field in the US.
GAIL Chairman and Managing Director B C Tripathi was not available for comment.
Jefferies & Co, a US-based global securities and investment banking group, is advising GAIL.
Jefferies & Co had also advised RIL on the Carrizo Oil and Gas Inc transaction last August.
Under this deal, RIL bought a 60 per cent stake in acreages held by Carrizo and its partner for $392 million.
These included the Marcellus shale gas areas in central and northeast Pennsylvania.
With this, RIL became
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