(Reuters) – U.S. private equity firm Kohlberg Kravis Roberts & Co [KKR.UL] is planning to start up a natural gas exploration company focusing on shale and coal-bed gas, Bloomberg said, citing a person familiar briefed on the plan.
KKR will mostly use equity to fund the exploration business, which will focus on parts of Appalachia and Texas, it said.
“The promise of shale and what it means to domestic oil and gas production is significant, but the cost to get there is very significant too,” Marc Lipschultz, a partner who oversees energy and infrastructure investments, told the agency in an interview.
Shale gas accounts for between 15 percent and 20 percent of U.S. gas production but is expected to quadruple in coming years, touching off a scramble among producers large and small for access to resources. [ID:nN18229665]
KKR could not immediately be reached for comment by Reuters outside regular U.S. business hours. (Reporting by Sakthi Prasad in Bangalore; editing by Simon Jessop)