Posted by: mulrickillion | October 11, 2011

Weekly Update: India delves further into US shale sector

Oil & Gas Financial Journal, Sept 30, 2011 —

By Eoin Coyne

Evaluate Energy

GAIL Ltd. became the latest government-backed Asian company to join the US shale sector this week when it committed $95 million to acquire a 20% interest in 20,200 acres in the  Eagle Ford Shale play. After negating the assumed value of the production included with the asset, the cost per undeveloped acre equates to $17,000, representing the high liquids content of the Eagle Ford and also the inflated price that the Asian NOC’s seem willing to pay to enter into US shale agreements. Following this deal, Carrizo Oil & Gas entered into an acquisition in partnership with Avista Capital Partners to acquire 15,000 acres in the Utica Shale play for less than $1,500 per acre.

For the second week in a row, North Sea assets have featured heavily in the upstream M&A sector. Back in March 2011, when the UK budget announced an increase in the supplemental tax to 32%, there was widespread condemnation and threats of withdrawal from some senior companies within the industry. The UK Government however called the companies bluff, sticking to its tax proposal and now six months later, the region is again attracting major investments.

This week, the deal in question is ENI’s $844 million acquisition of GDF SUEZ’s 10.4% interest in the Elgin and Franklin fields, which has followed on from Apache Corp.’s $1.75 billion acquisition of certain North Sea fields from ExxonMobil last week. . . .

Weekly Update: India delves further into US shale sector – Oil & Gas Financial Journal

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