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Shell Signs Upstream Deals With CNOOC, CNPC For China, Gabon Projects

07/25/2012 | 06:27am US/Eastern

LONDON–Royal Dutch Shell PLC (RDS.LN) Shell announces Wednesday that it signed two offshore oil and gas Production Sharing Contracts, or PSCs, with the China National Offshore Oil Corporation, or CNOOC, and a PSC amendment with CNPC, the China National Petroleum Corporation, for a new development phase for the Changbei gas field in China.

MAIN FACTS:

-Also entered an agreement with CNOOC for its participation in two Shell exploration blocks offshore Gabon, West Africa.

-The two offshore oil and gas PSCs with CNOOC are for blocks 62/02 and 62/17 in the Yinggehai Basin.

-Shell, as operator, will conduct 3D seismic data surveys in the Yinggehai blocks.

-Will cover costs for the acquisition of seismic data and will drill exploration wells during exploration phase.

-Shell will hold a 100% working interest during the exploration phase, that will be reduced to 49% in any eventual development phase, with CNOOC as majority partner.

-In Gabon, CNOOC will acquire a 25% participating interest in offshore exploration blocks BC9 and BCD10.

-CNOOC will reimburse Shell for 25% of certain past exploration costs and carry part of the future exploration costs.

-Shell will remain operator with 75% interest

-Agreement is subject to government approval

-Shell’s “A” Shares at 1008 GMT i[ 19 pence, or 0.9%, at 2,189 pence, valuing the company at GBP141.1 billion.

-Write to Ed Ballard at [email protected]

SOURCE

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