Shell to Sell Stake in Thai Oilfield

Shell plans to sell part or all of its stake in the S1 onshore oilfield in Thailand, Thai Energy Minister Prommin Lertsuridej said Thursday.

"Shell has informed me that it is in the process of changing shareholders of the S1 oil field," Prommin said after meeting with Dominique Gardy, CEO of Shell Exploration and Production, Asia Pacific region.

However, Prommin declined to elaborate on how much of its stake Shell would like to sell or who would be the new shareholder in the oilfield.

He said Thailand's PTT Exploration and Production PCL is interested in increasing its stake in the S1 oil field. Shell currently holds a 75% stake in the S1 field, with the remainder held by PTT Exploration and Production.

Shell is considering selling its stake in the S1 field due to high operation costs and declining crude production, said Prommin. "The current valuation allows the company to sell the asset at an attractive price," Prommin said.

The company's assets in Thailand are the S1 onshore oil field and Block B6/27 in the Gulf of Thailand. The company has invested $850 million in the S1 field and another $170 million in block B6/27.

The S1 field, the country's largest onshore crude oil production field, produces about 20,000 barrels of crude a day. It also produces 55 million cubic feet a day of natural gas and 300 metric tons of liquefied petroleum gas a day.

However, the company hasn't been operating the B6/27 block since 1997 due to technical difficulties.