Itochu sells back its $1bn US shale stake to Samson for $1

Japanese Itochu has sold its 25% stake for shale oil assets in the US, back to Samson Resources for $1.

The firm had acquired the stakes in Samson four years back for more than $1bn.

The sale was a part of the 2011 deal signed by a KKR-led consortium, which bought Samson’s distressed energy assets for $7.2bn.

Itochu’s exit decision was influenced by Samson’s state of operations and the dip in gas prices in North America, reports Bloomberg.

The firm had already written down its acquired share for the shale assets over the past few years.

This sale of the stake is thus unlikely to affect Itochu’s financial target for the year, the company said.

Itochu intends to be ‘extremely careful’ for its future investments in the US shale gas sector. The firm will go along with acquisitions only after conducting through investigation of risks and related development and energy prices.

Itochu was quoted by Financial Times as saying: "We are not ruling out the resource business, but we will carefully examine the profitability and risks of future deals including trends in shale gas and oil prices."

Gas prices in the US have reached an all time low in over ten years while crude oil prices have also dipped 50% in 2014.

Another Japanese trading entity Sumitomo had also taken a hit due to the decreasing oil prices, which had pushed it towards its first net loss in 16 years according to its March fiscal year reports.