Acquisition at Stake by Gail in Carrizo
GAIL has formed an unincorporated joint venture in September’ 2011, with Carrizo Oil & Gas Inc. (“Carrizo”), a NASDAQ (CRZO) listed company based in Houston, Texas to acquire 20 % interest in Carrizo’s offered acreage in Eagle Ford Shale. The Joint Venture will have over 20,000 gross acres. GAIL has formed a wholly-owned subsidiary, GAIL Global (USA) Inc. in Texas, USA to acquire the Shale gas assets. Carrizo will continue to function as the operator for the joint venture. The transaction is valued at US$ 95 million. The asset is currently producing from 8 wells and the overall future development would comprise around 130 wells.
Through this transaction, GAIL shall be able to:
(i) augment its technical know-how in Shale gas. Carrizo has agreed to partner GAIL in opportunities in unconventional gas in India as well as third countries.
(ii) achieve transfer of knowledge, via a working interest position and from secondees to Carrizo.
(iii) gain foothold in North America for exploring other opportunities.
(iv) provide early revenue generation as the asset is producing in nature.
This information was given by the Minister of Petroleum & Natural Gas Shri S. Jaipal Reddy in a written reply in the Lok Sabha today.
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