Indian Adani Welspun to invest $1.5 billion in North American shale assets

National flag of India
Source: DollarPhotoClub

Adani Welspun Exploration (AWEL) – an upstream oil and gas JV between Ahmedabad-based Adani Group and Mumbai-based Welspun Group – is planning to follow the footsteps of other Indian companies such as Reliance Industries, GAIL, IOC and Oil India, in acquiring shale assets in North America.

Adani and Welspun have a strategic partnership for oil and gas business and already hold interests in conventional blocks in India, Thailand and Egypt. According to The Times of India, they now are eyeing select Louisiana and Texas shale fields in the US and some Alberta oil sands projects in Canada, planning to invest $1.5 billion in hydrocarbon-producing unconventional resources.

The two companies are convinced that shale and oil sands will play a greater role in the world’s total energy mix and, hence, want to invest in these areas, said sources familiar with the matter.

This is their second attempt at capitalising on the North American shale boom. Initially, a joint venture firm, in which Adani owns majority shares, bought exploratory blocks in the hope that they will produce hydrocarbons at a commercial level. This time round, Adani Welspun plans to buy interest in already oil-producing assets.

While the joint venture has an overall investment plan of $1.5 billion for overseas energy assets, it seeks buys entailing a minimum investment of $300 million, according to a source close to the two companies.

Indian firms have so far invested over $10 billion in US shale gas, of which Reliance alone has invested over $7 billion.

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