Shell announces the sale of onshore US shale gas assets as the energy company restructures its North America production and reins in costs.
Royal Dutch Shell plc announced Thursday that it was divesting itself of onshore gas assets in Pinedale, Wyoming and Haynesville, Louisiana while adding acreage in the Marcellus and Utica shale areas. The deals will see Shell received approximately $2.1 billion in cash.
In an agreement with Ultra Petroleum, Shell will acquire 155,000 net acres in the Marcellus and Utica shale areas in Pennsylvania, and receive around $925,000 from Ultra in exchange for 100 percent of Shell's Pinedale asset. In a separate agreement with Vine Oil & Gas and Blackstone, Shell has agreed to sell 100 percent of its Haynesville asset for $1.2 billion in cash.
Shell Upstream Americas Director Marvin Odum commented in a company statement:
"We continue to restructure and focus our North America shale oil and gas portfolio to deliver the most value in the longer term. With this announcement we are adding highly attractive exploration acreage, where we have impressive well results in the Utica, and divesting our more mature, Pinedale and Haynesville dry gas positions."
Shell's net production from Pinedale during the second quarter of 2014 was 190 million cubic feet per day of dry gas. Ultra's net production from the assets Shell is acquiring in Pennsylvania averaged 109 million feet per day during the first half of the year.
Shell's Haynesville asset includes 107,000 net acres in in north Louisiana. The transaction includes 418 producing wells, 193 of them operated by Shell. As of July 1, 2014 the gross production from the Haynesville asset was approximately 700 million cubic feet per day of dry gas, with Shell’s net working interest share at approximately 250 million cubic feet per day (43,000 barrels of oil equivalent per day). The agreement is expected to close during the fourth quarter of this year.
Shell is in the middle of a cost-cutting drive to boost revenue that will include the sale of $15 billion of assets around the world.
Have a news tip? Share it with Rigzone!
WHAT DO YOU THINK?
Click on the button below to add a comment.
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
More from this Author
Most Popular Articles
From the Career Center
Jobs that may interest you