New forray: for BG
BG hooks up with Exco for US shale gas
BG Group will pay $1.3 billion for a 50% stake in a venture with Dallas-based Exco Resources that represents the British gas producer's entry into US shale gas production.
The new venture will own 120,000 acres of land in the Haynesville shale gas area in Texas and Lousiana and associated gas transport infrastructure, the companies said today.
Production of gas from shale formations, which is more complex than production from simple gas reservoirs, jumped in recent years as US gas prices soared on the back of record crude prices.
However, weak demand for gas, due to the economic crisis, and lower oil prices have hit gas prices, forcing some operators to cut production, reported Reuters.