Marianne Barriaux
Saturday November 24 2007
Shell has pulled out of a £200m deal to buy into Ukrainian gas fields only two days after it was signed after a boardroom row at its controversial would-be partner, Regal Petroleum.
The Anglo-Dutch company agreed on Wednesday to buy a 51% stake in Regal’s Ukrainian gas fields for $50m (£24m), saying it would invest the first $360m of development costs. But on Thursday Regal abruptly announced that its chief executive, Neil Ritson, and chairman, Francesco Scolaro, had been replaced by David Greer, a former Shell executive.
Ritson was the key engineer of the agreement between Shell and Regal, and has been largely credited for improving Regal’s reputation after a series of misfortunes struck the firm, including a dry well in Greece and a legal dispute over its right to the licence for the Ukrainian gas fields.
Shell said yesterday: “The management change at Regal was not expected by Shell and we see from the new management’s comments that they may have changed their thinking on the transaction.”
It added Regal had indicated it would like to review its options, and Shell had therefore decided not to proceed with the deal. Regal Petroleum was not available for comment.
It is understood that Frank Timis, the colourful founder of Regal who now owns 20% of the firm, had wanted the company to raise money for development independently.
It is thought that Timis, along with other shareholders, forced Ritson out. Greer then suggested other options to raise the funds, including a share issue. This is thought to be what prompted Shell to pull out.
http://www.guardian.co.uk/business/2007/nov/24/shell
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I am confused… so is Shell still going to work/develop, etc. the 8 fields in Ukraine???