Reliance signs agreement for sale of assets in the US

Reliance Marcellus II, LLC, a subsidiary of Reliance Holding USA, and Reliance Industries Limited, announced on Friday that the company will be signing agreements to divest all its interest in several upstream assets in north-eastern and central Pennsylvania.  

The assets that are currently operated by Carrizo Oil & Gas, were sold to BKV Chelsea, LLC, an affiliate of Kalnin Ventures LLC, for an amount of USD 126 million. In addition to that, Reliance will receive a contingent payment of up to USD 11.25 million in aggregate, based on natural gas prices exceeding several thresholds over the coming three years.

The assets produce mainly gas and are located in Susquehanna, Wyoming and Clearfield Counties of Pennsylvania.

The sale of the assets will be consummated in accordance with the terms of a purchase and sale agreement, dated October 5, 2017, by and between Reliance and the buyer. The transaction is likely to be closed by the end of the third quarter of FY18. 

Reliance has assigned Citigroup Global Markets to be its financial advisor, while Haynes and Boone will serve as its legal counsel. 

In Friday’s trade, Reliance Industries closed at Rs 836.85 per share, higher by nearly 2 per cent on BSE. The stock had hit its 52 week high of Rs 872.10 per share on September 20, 2017 and its 52 week low of Rs 466 per share on November 9, 2016 on BSE, respectively.