Ril To Sell Gas To Retail Consumers In Us

Reliance Industries plans to sell gas to retail consumers in the US and will use

its newly-minted partnership with Atlas Energy to try and build a brand name in the intensely competitive market.

RIL, which bought 40% in Atlas Energy some weeks ago, plans to use the pipeline infrastructure that Atlas already has to supply through its own network of gas stations in the worlds biggest energy market. An RIL spokesperson declined comment on the development.

A person close to the development said RILs US venture, a subsidiary of RIL Netherlands, will transport gas using the network. The company initially plans to supply to consumers in New York, Virginia among others.

Having acquired the stake in the shale gas fields, RIL along with its joint venture partner Atlas Energy will soon begin work on the development of the field to start producing gas. As opposed to many crude oil and gas acreages, the shale gas fields are all proven assets (where time and money are not wasted on exploration) and RIL can get into the development stage right away.

RIL already exports a bulk of its refined petroleum products, primarily gasoline, to the US markets but is not in the retail market.

But RIL officials are gung ho about the overseas operations. The firm is looking at increased revenues from its offshore assets in the coming years and is planning to invest a bulk of its capex in these markets in the years to come, an RIL official, who did not wish to be named, said.

We are looking at an EBIDTA of at least 35% of our revenues from global operations, he said.

Although gas markets are currently soft with demand for natural gas seeing a huge fall after the recession, it is expected to pick up in the medium term.

RIL may also soon have some more acreages of shale gas that Atlas is expected to close on shortly. As per the understanding, RIL will get 40% of the share in every new shale gas asset. Interestingly, apart from an assured share, the company also has an understanding that it would acquire the future stake at a price not higher than $8,000 per acre. It acquired its stake in Atlas for $1.7 billion, or $14,000 per acre.

Shale gas is like natural gas that is trapped within marine sedimentary rock layers and is considered to be a promising new source of hydrocarbons. The net potential of the Marcellus fields in Pennsylvania is approximately 13.3 trillion cubic feet equivalent (tcfe) of natural gas, with RIL having a claim of over 5.3 tcfe. RILs KGD6 gas field on Indias eastern coast has an estimated potential of 11 tcfe.

by: Priyanka Patel

POST COMMENT

Consumer Rights And Duties DirecTV Fined $14 Million for Violating Consumer Practices Retail Shops – A boon to Consumers Getting Rid Of Massive Interest Rates Just By Curing Your Consumer Statement Modern Procuring For The Consumer Options For Consumers Facing Interest Rate Increase Thoughts on Consumer Awareness Facts For Consumers Use A Consumer Report Treadmill Guide To Get A Good Buy Water Beds And Bedding Details For Consumers Ftc Annual Report Details Efforts To Protect Consumers From Fraud Vending Machine Consumer Perceptions The Rising Ambition of Consumers