Reliance Industries has sold its 49.9 per cent stake in a US joint venture that owns a pipeline network for transportation of shale oil and gas, to New York-listed Enterprise Products Partners for $1.07 billion.
RIl and its partner Pioneer Natural Resources Co sold off Eagle Ford (EFS) Midstream venture, that owns a 460 miles pipeline network, to Enterprise Products Partners for $2.15 billion. Enterprise in a statement said, “The purchase price will be paid in two instalments with the first instalment of $1.15 billion paid at closing and the final instalment of $1 billion paid no later than the first anniversary of the closing date.”
EFS Midstream venture was formed in 2010 to construct facilities to provide gathering and handling services for condensate and natural gas produced from wells on dedicated acreage in the Eagle Ford. RIl, through its subsidiary Reliance Holding USA Inc had acquired 49.9 per cent stake in EFS Midstream llC in June 2010.
The Midstream system consists of 10 gathering plants and about 460 miles of pipelines. The system gathers and separates produced condensate from produced gas. It also stabilises the condensate, where necessary, and treats the gas produced from the Eagle Ford upstream joint venture operated by Pioneer with 46 per cent. RIl holds 45 per cent interest in the Eagle Ford upstream joint venture and the rest 9 per cent is with Newpek llC.
It is being speculated that RIl may be looking at selling this stake as well. RIl, which bought 45 per cent interest in Pioneer Natural Resources Co’s Eagle Ford shale formation of south Texas for $1.3 billion, is working with Citigroup Inc and Bank of America Merrill lynch to find a buyer.