Royal Dutch Shell has increased its stake in some Australian LNG fields by swapping assets with US oil major Chevron
By Garry White: 4:31PM BST 20 Aug 2012
Royal Dutch Shell and Chevron have agreed to swap assets in Australia, with the Anglo-Dutch energy giant increasing its interest in a key liquefied natural gas project.
Shell will pay Chevron $450m (£287m) and swap its interest in 2 offshore oil fields in return for Chevron’s interest in the Browse liquefied natural gas (LNG) project.
Australia’s Woodside Petroleum is the operator of the Browse project, in partnership with Shell, BP, Chevron and BHP Billiton. Following completion of this transaction, Shell will hold a 35pc interest in West Browse and 25pc interest in East Browse.
However, there have been a number of delays getting the project off the ground, including opposition from environmentalists and Aboriginal landowners.
“This is a good deal, not only because it aligns with Shell’s strategy of bigger direct stakes in key gas resources, but because it also helps to simplify the ownership of the Browse gas fields,” Andy Brown, Shell’s upstream international director, said.
Seven of the world’s 10 major LNG projects are currently under construction in Australia. The country is heavily investing in the sector to support Asian energy demand. Australia is expected to overtake Qatar, which has the world’s third-biggest gas reserves, as the largest exporter of LNG by 2020. Last year the Gulf Emirate’s production capacity hit 77m tonnes a year.
Shares in Shell fell 12½ to £23.34.
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