US energy firm Williams mulls acquiring Bakken shale fields for $925 million

The Williams Companies Inc, a US-based gas exploration and production company, yesterday said that it has agreed to buy 85,800 net acres in North Dakota's Bakken shale play for $925 million in cash, in order to diversify its exploration and production interests into light, sweet crude oil production.

Tulsa, Oklahoma-based Williams has become the latest energy company to bet on shale gas in the US after oil majors like Chevron, China's CNOOC and India's Reliance Industries have made large ticket shale acquisitions this year.

Without naming the sellers, Williams, a Fortune 200 company, said that it is buying approximately 85,800 net acres from private owners for $925 million. The acreage is located entirely on the Fort Berthold Indian Reservation, located in the Williston Basin of North Dakota.

The acquisition values the shale fields at just below $11,000 per acre, which is higher than Chevron this month paid for acquiring Atlas Energy, where it valued Atlas' Marcellus shale properties at $9,000 an acre. (See: Chevron to acquire Atlas Energy for $4.3 billion)

CNOOC had paid in October 2010 around $10,800 an acre for one-third interest in Chesapeake Energy's 600,000 acres in the Eagle Ford gas field in South Texas, while Reliance had paid around $11,100 an acre in June 2010 when it acquired a 45-per cent interest in 212,000 net acres in Eagle Ford Shale play from Pioneer Natural Resources.

But it is almost double the $5,300 per acre paid by Hess Corp for American Oil & Gas Inc acreage in Bakken in July 2010.