Reliance Industries, the Indian group behind the resurgence of the country’s domestic natural gas production in competition to LNG, has sold its stake in the US Eagle Ford Shale play in south Texas to a Delaware-registered company.
The Indian company said the US unit, Reliance Eagleford Upstream Holding, signed agreements with Ensign Operating LLC to “divest its interest in certain upstream assets” in the Eagle Ford Shale.
US sell off
“With this transaction, Reliance has divested all its shale-gas assets and has exited from the shale-gas business in North America,” stated Reliance.
The sale followed Reliance’s off-loading of its Marcellus Shale assets in southwest Pennsylvania in February 2021 to Northern Oil and Gas Inc., also a Delaware corporation, for $250 million. The value of the Eagle Ford transaction was not disclosed.
Reliance is India’s largest private sector company with annual turnover of $78 billion.
The company said its sales deal was signed with Ensign on November 5 for the Eagle Ford holdings.
The previous Asian company to withdraw from US shale was Japanese trading house Sumitomo Corp.
The company sold its shale oil business in the US, which was partly in the Eagle Ford Shale, during the fourth quarter of 2020.
Reliance is the leading Indian natural gas producer in the ultra-deep-water blocks in the Krishna Godavari Basin offshore the East Coast and supplying a large proportion of the nation’s domestic gas needs.
Reliance and partner, UK major BP, have brought on stream two out of three development blocks in the KG D6, the principal Indian gas basin.
The onstream fields are called R Cluster and the Satellite Cluster and the third, which is still to start up, is called the MJ field. Together they can produce around 30 million standard cubic metres per day. The fields in the project are able to utilise the existing hub infrastructure in KG D6 block, in which Reliance is the operator with a 66.67 percent stake and BP holds 33.33 percent.
The MJ field is expected to come onstream towards the latter half of 2022 to further boost output.
India’s LNG imports of more than 320 cargoes a year are currently on a par with its domestic natural gas output.
The three new KG D6 fields. along with LNG imports, are supporting the country’s policy to improve clean energy resource availability in the future mix.
