Calgary-based Nexen Inc. (TSX: NXY) announced today that it has formed a partnership with INPEX Corp. of Japan to develop its shale gas lands in Northeastern B.C.’s Horn River, Cordova and Liard basins.
Nexen will sell a 40% working interest in its assets for $700 million and will remain the operator.
Marvin Romanow, Nexen’s president and CEO, said, “This joint venture represents a significant milestone in the advancement of our shale gas strategy and the premium over our invested cost shows the value we have created in a short time.”
The deal is expected to close in the first quarter of 2012, when $600 million is due to Nexen.
Nexen will retain a 60% interest in the joint venture lands; the remaining 40% will be owned through INPEX Gas British Columbia Ltd., which is a joint venture by INPEX (82%) and JGC Corp. (18%).
The parties will also jointly investigate the feasibility of a potential downstream project including liquid natural gas exports.
INPEX has 71 oil and gas projects in 26 countries, making it Japan’s largest oil and gas exploration and production company.
The deal is contingent upon Canadian regulatory approval and INPEX financing.
Jennifer Harrison
@JHarrisonBIV