Kuwait Petroleum unit to buy 22.2% stake in Bongkot gas field
Sale is part of Shell’s $30 billion divestment program
Royal Dutch Shell Plc will sell its stake in an offshore Thai gas field to a unit of Kuwait Petroleum Corp. for $900 million as the international energy giant continues hawking assets for cash in the midst of a years-long energy slump.
Shell reached an agreement to sell two subsidiaries that own a combined 22.2 percent interest in the Bongkot field and adjoining offshore acreage to a subsidiary of Kuwait Foreign Petroleum Exploration Co., the unit known as Kufpec, Shell said in a statement Tuesday. A spokesperson for Kufpec, the international arm of Kuwait’s state-owned energy company, wasn’t immediately available to comment.
The Bongkot field started production in 1993 and came to Shell when it acquired BG Group Plc for $70 billion in 2015. To win shareholder support for that deal, Shell has promised cost savings of $2.5 billion, asset disposals of at least $30 billion within four years and a share buyback of $25 billion from 2017 to 2020.
“This transaction shows the clear momentum behind Shell’s global, value-driven $30 billion divestment programme, and is consistent with the company’s strategy to high-grade and simplify its portfolio following the acquisition of BG,” Shell said in the release.
The field’s other owners are Total SA, with a 33.3 percent stake, and PTT Exploration & Production PCL, which has 44.4 percent share and operates the field. The deal should be completed this quarter, Shell said in the release.