Korean Consortium Close to Buying $540m Stake in US Shale Gas Firm

A consortium including South Korea's National Pension Service (NPS) and gas seller E1 has been chosen as the preferred bidder to buy a $540m (£321.7m/€403.3m) stake in US-based shale gas transport company Cardinal Gas Services.

NPS, the world's fourth-largest pension fund, could invest around $250m, or the biggest portion of the funds required, for a 34% stake in Cardinal Gas Services, Reuters reported.

The division of stakes within the Korean consortium has yet to be finalised, the report added.

Cardinal Gas Services, a joint venture between Access Midstream Partners, a US-based Total unit, and EnerVest Energy Partners, manages gathering, compression and dehydration for oil and wet gas in the Utica shale region in Ohio.

E1's stock jumped on the news and finished up 4.61% in Seoul.

Earlier in the month, Austrian petrochemical firm Borealis signed a 10-year contract to buy ethane coming from the Marcellus and Utica shale formations, in Pennsylvania and Ohio respectively.

The US has become the world's largest producer of oil and gas, beating Russia or Saudi Arabia, as hydraulic fracturing and horizontal drilling has helped producers extract resources confined in shale rock formations.

Japan and South Korea are the world's leading importers of liquefied natural gas (LNG), and both nations struck deals in 2013 to buy gas from US terminals, in some cases paying for some of the development costs.