KKR & Co. has sold a swath of Texas shale to an unidentified oil company for about $140 million, and the private-equity firm made back twice its money on the property in a year, according to a person familiar with the matter.
The deal marks the third time in as many years that the firm has been able to flip energy-bearing shale fields and at least double its money. It underscores KKR’s continued drive to become a major player in U.S. oil and gas exploration.
In the last decade North American energy companies have combined horizontal drilling techniques with a rock-cracking process called hydraulic fracturing to unleash oil and natural gas from deeply buried rock formations called shale.
The resulting bounty has altered the U.S. energy picture, leading to a price-depressing flood of natural gas and pushing domestic oil production higher for the first time in decades. It’s also created opportunity for investors, as global energy giants pay to gain access to the vast reserves.
Source: Wall Street Journal
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