Total Takes $2.3 Billion Stake in U.S. Shale Gas Fields
French oil group Total said Tuesday it was taking a 25 percent stake in shale gas fields in the U.S. state of Ohio for a total investment of $2.3 billion (1.8 billion euros).
Total said its U.S. subsidiary was entering into a joint venture with a subsidiary of Chesapeake Energy Corporation and its partner EnerVest that hold rights to 619,000 acres (250,500 hectare).
It said it paid roughly $700 million in cash to acquire the fields, and committed to cover up to $1.63 billion in drilling and well completion investments over six years.
"This joint venture will provide us with a material position in a valuable long-term resource base under attractive terms and with a top-class operator," Total said in a statement.
The 13 wells drilled to date have shown promising results Total said, and that drilling is to be ramped up over then next few years with 25 rigs to be completed by 2014 to better evaluate the field.
Total said it expects that by the end of the decade that its share of production from the fields to reach 100,000 barrels of oil equivalent per day.