As part of plans to downsize future upstream operations globally, Shell is planning to sell some upstream assets in Egypt for up to $926 million.
The oil and gas firm said the divestment would allow it to focus on other operations in the North African country.
Shell Egypt and one of its affiliates will sell the assets to subsidiaries of Cheiron Petroleum Corp. and Cairn Energy for a base consideration of $646 million and additional payments of up to $280 million between 2021 and 2024, depending on the oil price and result of further exploration, Shell said in a statement.
The sold assets include Shell Egypt’s interest in 13 onshore concessions and the company’s stake in Badr El-Din Petroleum Co., it added.
The transaction, which is expected to be finalized by the second half of 2021, is subject to regulatory and government approvals.
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Shell Egypt recently acquired seven new offshore concessions in the West Mediterranean, the Red Sea and in the West Nile Delta.
The deal “will enable Shell to concentrate on its offshore exploration and integrated value chain in Egypt, including seven new blocks in the Nile Delta, West Mediterranean and Red Sea,” Shell’s Upstream Director, Wael Sawan, said.
“It will help Egypt maximize the potential of its onshore assets through new investment, helping secure energy and revenue for years to come.”
Shell Nigeria in January this year sold its 30 per cent stake in OML 17 to TNOG Oil and Gas, for $533 million to TNOG Oil, related company of Heirs Holding and Transcorp, following the approval of the government.
Shell wants to pursue more “value over volume” by simplifying its upstream assets to nine core positions; Brazil, Brunei, Gulf of Mexico, Kazakhstan, Malaysia, Nigeria, Oman, Permian and UK North Sea.
