Oil India Limited (OIL) and Indian Oil Corporation (IOCL) have jointly acquired a stake in Carrizo''s liquid rich shale assets in the Niobrara basin in Colorado, USA through their wholly owned US subsidiaries. Their first ever upstream acquisition in the USA, the two Public Sector companies today executed definitive agreements with Carrizo, a company based in Houston, Texas to enter into a joint venture.
Under the terms of the deal, OIL and IOCL will acquire 30 per cent (OIL - 20 per cent, IOCL: 10 per cent) in the Niobrara asset via their respective subsidiaries. Carrizo has 61,500 gross acres in the basin out of which the OIL - IOCL consortium will have 18,450 acres, spread across three counties in Texas.
The total investment for the two companies would be around US $82.5 Million, including an upfront cash payment of $41.25 million and a subsequent $41.25 million which is linked to Carrizo''s future drilling and development costs The investment provides the companies an entry into the early stage of an unconventional play in a well known producing basin. The transaction also provides the two companies with a platform for additional acquisitions in North America.
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