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Shell dumps assets onshore Gabon

Dutch supermajor said the $587 million sale is part of its effort to streamline after acquiring BG Group.

By Daniel J. Graeber
Shell dumps assets onshore Gabon
Shell is leaving parts of Africa behind as part of a divestment streak that followed its merger with BG Group. File photo by Mohammad Kheirkhah/UPI. | License Photo

March 24 (UPI) -- As part of an effort to streamline its portfolio after acquiring BG Group, Royal Dutch Shell said Friday it was leaving parts of Africa behind after 55 years.

Shell announced it would sell its entire onshore interests in Gabon to Assala Energy Holdings, part of The Carlyle Group, for $587 million. Andy Brown, a director for Shell exploration and production programs, said the company has a legacy extending back to the early 1960s.

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"The decision to divest was not taken lightly, but it is consistent with Shell's strategy to concentrate our upstream [exploration and production] footprint where we can be most competitive," he said in a statement. "This transaction shows the clear momentum behind Shell's $30 billion divestment program, and it helps us to high-grade and simplify our upstream portfolio following the acquisition of BG."

In the fourth quarter alone, the company unloaded more than $1 billion in assets in large part from North America. In January, it sold off its interests in a package of assets in the British waters of the North Sea for $3.8 billion.

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The tie-up with BG Group, valued at about $52 billion, was one of the biggest mergers since Exxon and Mobil joined forces in 1999. The Dutch supermajor, trimmed down after the merger, reported an 8 percent decline in profit last year for one of its weakest performances in more than a decade.

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Shell's divestment follows a similar move by French energy major Total, which said in February it was taking advantage of improved market conditions by selling mature assets in Gabon to Anglo-French company Perenco for $350 million.

Total said the divestment represented about 13,000 barrels of oil per day. Shell produced about 41,000 barrels of oil equivalent per day from Gabon last year.

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