* Oil India to get 20 pct, Indian Oil Corp 10 pct in
Niobrara shale acreage
* Indian oil companies scouring for assets overseas to
satisfy rising demand
* Oil India shares end up 2.3 pct, IOC up 2.4 pct
NEW DELHI, Oct 4 State-run firms Oil India Ltd
and Indian Oil Corp have jointly bought a 30
percent stake in Houston-based Carrizo Oil & Gas's
Niobrara shale asset in Colorado for $82.5 million, the
companies said in a statement.
The deal marks the first investment by the two state
companies in shale assets in the United States, where booming
shale gas output has caused prices to plummet and may push the
U.S. government to consider exports to energy-hungry Asia.
Oil India will acquire 20 percent and Indian Oil Corp will
get 10 percent in Carrizo's Niobrara basin acreage assets
through their respective subsidiaries.
"We have earmarked part of our reserves for acquisitions and
new opportunities to bolster our overseas portfolio and were
keen on joint ventures in countries with geo-political
stability," Oil India Chairman S.K. Srivastava told reporters.
India, the world's fourth-largest oil importer, imports
about 80 percent its crude needs, and has been scouting for oil
and gas assets overseas to satisfy rising local demand and to
feed its expanding refining capacity.
The total investment by the two companies would be around
$82.5 million, including an upfront cash payment of $41.25
million and a carry amount of $41.25 million, linked to
Carrizo's future drilling and development cost, the companies
said in a statement.
Oil India may raise $100 million in foreign loans by
December to part fund the deal, its finance director said.
As part of the transaction, Oil India and IOC will also
receive a 30 percent interest in Carrizo's existing production
of about 1,850 barrels of oil-equivalent a day from 24 gross
wells, it said.
Carrizo holds 61,500 gross acres in the Niobrara basin, of
which the Oil India-IOC consortium will have 18,450 acres,
spread over three counties in Texas.
Oil India, whose assets in India's northeast account for its
entire crude oil production and the bulk of gas production, has
been aggressively scouting for overseas assets in discovered and
producing assets overseas.
The company, along with Indian Oil Corp, the country's
biggest fuel retailer, holds stakes in oil and gas blocks in
various countries including Venezuela, Libya, Gabon, Iran, Yemen
India's largest listed company, Reliance Industries
, holds stakes in three shale gas joint ventures in the
United States, including one with Carrizo in the Marcellus shale
acreage in Pennsylvania.
State gas utility GAIL India acquired a 20 percent
stake in Carrizo's Eagle Ford shale acreage last year.
Shares in Oil India closed up 2.3 percent in a strong Mumbai
market. Indian Oil shares ended up 2.4 percent.