Oil India and Indian Oil Corporation Make First US Shale Acquisition

State-run Oil India Ltd. (BSE:533106) announced that together with Indian Oil Corporation Ltd. (BSE:530965) it has acquired 30 percent of Carrizo Oil & Gas Inc.’s (NASDAQ:CRZO) interest in about 60,000 net acres of Denver shale assets.

As quoted in the press release:

As part of the transaction, OIL and IOCL will also receive a 30% interest in Carrizo’s existing production, of approximately 1850 BOE/ day from 24 gross wells.

The total consideration is US$ 82.5 Million consisting of an upfront cash payment of US$ 41.25 Million and the assumption of US$ 41.25 Million of Carrizo’s future drilling and development costs.

This investment provides an early entry into a prolific unconventional oil play. The D-J Basin is a well known producing basin where many U.S. E&P companies are successfully developing the Niobrara formation. The transaction also provides a platform to the companies for additional acquisitions in North America.

Click here to read the full Oil India Ltd. (BSE:533106) press release.