BG Group Makes Small Investment In Australian Shale Gas
26 Julho 2011 - 11:23PM
Dow Jones News
BG Group PLC (BG.LN) has dipped its toes into Australia's
largely dormant shale gas sector, in a small bet that longer term
demand for gas will make the unconventional fuel's development more
cost competitive.
Shale gas is popular in the U.S. but Australia has some of the
world's lowest gas prices. A vast supply of conventional and coal
seam gas have proven cheaper to produce, limiting the appeal of
shale gas.
BG said it has formed a joint venture with minnow Drillsearch
Energy Ltd. (DLS.AU) to investigate the potential of a vast shale
gas deposit locked in central Australia's Cooper Basin. Shale gas
is trapped in dense rock formations and can be extracted with
drills that emit high-pressure bursts of water, sand or
chemicals.
The British group will take a 60% stake in some exploration
permits and be issued Drillsearch shares to take a 9.9% stake in
the company at a strike price of 62 cents a share. It has agreed to
a five-year, A$130 million exploration and pilot production
program, with BG to fund A$90 million of the first A$100 million,
Drillsearch said.
Drillsearch shares are up 7.5 cents, or 14.2%, at 60.5 cents on
news of the deal.
Australian company Beach Energy Ltd. (BPT.AU) is also
investigating the commercial potential of Cooper Basin shale gas.
It is currently assessing two completed exploration wells and
intends to drill a pilot production well next year.
-By Ross Kelly, Dow Jones Newswires; 61-2-8272-4692;
Ross.Kelly@dowjones.com
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