Shell continues divestment streak with Irish sale

By Daniel J. Graeber  |  July 12, 2017 at 6:30 AM
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July 12 (UPI) -- The $1.23 billion gained from leaving parts of the Irish energy sector puts Shell past the halfway point for its total divestment goal, a company director said.

Shell said a subsidiary was selling off its 45 percent stake in the Corrib natural gas venture as part of a broader divestment effort. Andy Brown, the company's director for exploration and production, said the sale is part of Shell's effort to reshape its portfolio for future value.

"It demonstrates the strong momentum behind our three-year $30 billion divestment program," he said in a statement. "At the half-way point, we have now announced deals valued at more than $20 billion."

In May, Shell's aviation subsidiary in Australia sold to independent Viva Energy Australia for $250 million. Shell kept its brand name visible in the aviation refueling sector as Viva Energy remained the licensee of its fuels.

Shell in March announced plans to sell off its entire onshore interest in Gabon to Assala Energy Holdings, part of The Carlyle Group, for $587 million.

The company's merger 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.

For undisclosed terms, the company said Tuesday its offshore affiliate was exercising a contractual right to by the Turritella floating, production, storage and offloading vessel that it will use at the Stones deep water prospect in the U.S. waters of the Gulf of Mexico. The deepest offshore project in the world, Shell said it will start delivering up to 50,000 barrels of oil equivalent per day by the end of the year.

Shell has three projects in the U.S. Gulf of Mexico under construction. Irish territorial waters, meanwhile, are 10 times the size of its land territory, though reserves there are largely unexplored.

Shell pulled first gas from the Corrib gas field off the northwest coast of Ireland in 2015. The reserve yielded about 27,000 barrels of oil equivalent per day last year.

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