(Repeats story issued late on Thursday)
* In talks with U.S.-based Pioneer Natural Resources -
* Reliance also eyeing several other shale assets
* Pioneer shares up 3.1 pct; Reliance closes up 0.9 pct
(Adds details, backgorund)
By Pratish Narayanan
MUMBAI, June 10 Indian energy major Reliance
Industries (RELI.BO) is in talks to buy a stake in the shale
gas assets of U.S.-based Pioneer Natural Resources (PXD.N), two
sources familiar with the matter said on Thursday.
Reliance, India's largest listed conglomerate controlled by
billionaire Mukesh Ambani, is also talking to several other
firms for buying shale gas assets, the sources said. They
declined to be named as they were not authorised to speak to
Pioneer said last month it was pursuing a joint venture to
accelerate the development of its Eagle Ford Shale operations,
with an announcement expected by the end of the second quarter.
The purchase value or the size of the stake in a potential
deal with Pioneer have not yet been finalised, one of the
Reliance declined to comment, while Pioneer did not
immediately return calls seeking comment.
Pioneer owns about 310,000 gross acres in the prospective
in the Eagle Ford shale play in southern Texas, according to
the company's website.
The Eagle Ford Shale is seen as an attractive prospect as
it is rich in natural gas liquids and condensates, which
command higher prices than regular natural gas.
In April, Reliance bought a 40 percent stake in the
Marcellus Shale operations of Atlas Energy ATLS.O for $1.7
billion, to form a joint venture at one of the most promising
natural gas deposit regions in the United States.
Companies from across the globe are increasingly investing
in shale plays that are expected to be very lucrative. Shale
gas accounts for between 15 percent and 20 percent of U.S. gas
production, but is expected to quadruple in coming years,
touching off a scramble among producers large and small for
access to resources. [ID:nN18229665]
But shale gas is harder and more expensive to extract
because it comes from rock rather than traditional reservoirs.
Drilling could also become more expensive due to
environmental challenges. Environmentalists say the drilling
fluids that crack the rock and free the gas can contaminate
drinking water. The industry disputes this.
Reliance has been working hard to expand its presence
outside India, break into new markets and broaden its various
businesses including refining, oil and gas exploration and
Chairman Mukesh Ambani, the world's fourth-richest man with
an estimated fortune of $29 billion, was freed to enter sectors
such as telecoms and finance after ending a pact last month
with his long-estranged brother Anil Ambani that prevented them
from competing on each other's turf. [ID:nSGE64N1IR]
Shares in Pioneer were trading up 3.1 percent on the New
York Stock Exchange, while Reliance had closed up 0.9 percent
in Mumbai on Thursday.
(Additional reporting by Michael Erman in New York and Arup
Roychoudhury in Bangalore; Editing by Unnikrishnan Nair)