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UK oil assets sold to Arab Emirate company

UK oil assets sold to Arab Emirate company

By Graham Ruddick

Last Updated: 1:59am BST 08/07/2008




UK oil companies Shell and Esso have agreed to sell assets in the North Sea to the Abu Dhabi National Energy Company, Taqa.

The deal with Taqa, whose majority owner is the Abu Dhabi government, involves six offshore and two sub-sea oil fields located in the East Shetland basin.

Shell, which is the operator of the venture, and Esso Exploration and Production UK, whose parent company is ExxonMobil, have been in negotiations with Taqa Bratani, an Aberdeen-based subsidiary of Taqa, since March.

Shell announced last June that they were looking to sell the interests, saying they were “relatively high cost” and “other operators might be better placed to add value”.

The chief executive of Taqa, Peter Barker-Homek, said yesterday that the announcement brought the company “one step closer to our stated strategy of building a global energy company”.

He added: “We believe that the North Sea offers significant potential for companies like Taqa.

“We will be making a significant investment over the coming years to extend the productive life and commercial viability of our assets.”

The company has been looking to increase its presence in Europe.

It has already acquired more than $1bn (£504m) of North Sea oil and gas assets since 2006 from BP and Canada’s Talisman Energy.

The value of the sale was not released, but it includes all equity, infrastructure and production licences for the Tern, Eider, Cormorant North, South Cormorant, Kestrel and Pelican oil fields and related sub-sea satellite fields.

The fields in the deal produce around 40,000 barrels per day of oil equivalent.

In 2007, Shell produced approximately 297,000 barrels per day in the UK.

The transaction remains subject to government consent and is expected to be completed later in the year.

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