Reliance Eagleford Upstream Holding has signed agreement for the sale of its assets in the Eagleford shale play in Texas USA.
Reliance Eagleford Upstream Holding, ("REUHLP") a wholly owned step-down subsidiary of Reliance Industries ("RIL"), announced the signing of agreements with Ensign Operating III, ("Ensign"), a Delaware limited liability company to divest its interest in certain upstream assets in the Eagleford shale play of Texas, USA.With this transaction, Reliance has divested all its shale gas assets and has exited from the shale gas business in North America.
A purchase and sale agreement ("PSA") has been signed between REUHLP and Ensign on 5 November 2021 for this sale. The sale is at a consideration higher than current carrying value of the assets.
On 23 June 2010, Reliance Eagleford Upstream Holding LP ("Reliance LP") executed definitive agreements to enter into a joint venture with Pioneer Natural Resources USA, Inc. (Pioneer) under which Reliance LP acquired a 45% interest in Pioneer's core Eagle Ford Shale acreage position in two separate transactions for a total of $264 million in cash and $1.05 billion of drilling carry obligations. The drilling carry obligation provided for 75% of the other joint venture partners' capital costs over an anticipated six-year development program. In addition, Reliance LP was to fund its share of the development plan.
Pioneer and Newpek LLC, Pioneer's then-current partner in the Eagle Ford Shale, simultaneously conveyed 45% of their respective interests in the Eagle Ford Shale to Reliance LP. The LP became a partner in 262,683 net acres. In December 2012, Reliance LP fully met its $1.05 billion drilling carry commitment.
Effective 1 January, 2019, Pioneer sold its entire working interest in the joint venture to Ensign Operating LLC (Ensign), a Delaware limited liability company.
On a consolidated basis, RIL reported 46% increase in net profit to Rs 15,479 crore on 50.7% rise in net sales to Rs 1,67,611 crore in Q2 September 2021 over Q2 September 2020.
RIL is the largest private sector corporation in India. Its activities span hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, retail and digital services.
Shares of RIL were almost flat at Rs 2500.90 on the BSE.
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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)
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