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Tunisia faces exodus of Western oil giants

Tunisia faces exodus of Western oil giants

LONDON (Reuters) – Royal Dutch Shell and Italy’s Eni are seeking to sell their oil and gas operations in Tunisia, industry sources said, as the North African country struggles to attract new investments following years of political instability.

Shell has hired investment bank Rothschild & Co. to sell its Tunisian assets, which include two offshore gas fields and an onshore production facility the Anglo-Dutch company acquired as part of its 2016 $53 billion takeover of BG Group, the sources told Reuters.

Shell tried to sell its Tunisian assets in 2017 but abandoned the process due to legal disputes with the Tunisian government.

Rothschild did not respond to requests for comment. Eni and Shell declined to comment.

Eni, which has operated in Tunisia since 1961, has hired investment bank Lazard to run its sale, according to the sources.

Eni produced around 5,500 barrels of oil equivalent per day (boed) in Tunisia in 2019 and has nine oil and gas production concessions and one exploration permit in Tunisia, according to its website.

The gradual departure of major western energy companies from Tunisia in recent years follows growing frustration with the country’s unstable regulatory and political environment since the 2011 revolution that has led to investments drying up.

It also comes as the world’s top oil and gas companies are seeking to sell tens of billions of dollars worth of assets to reduce debt and focus on the most competitive production.

Tunisia’s Energy Ministry told Reuters: “We have no official knowledge that these companies will sell their assets.”

Austrian energy company OMV also plans to sell its remaining oil and gas portfolio in Tunisia after gradually reducing its presence in the country, the sources said.

OMV declined to comment.

In 2018, OMV sold the majority of its portfolio in the country to Oslo-listed Panoro Energy for $65 million. It produced around 4,000 boed in 2019, according to its annual report.

Last year OMV and Tunisia’s national oil company started the Nawara gas field, the largest project in the country in recent years which is will increase OMV’s output by 10,000 boed at its peak, according to the company.

Mazarine Energy, backed by private equity giant Carlyle Group is also seeking to sell up to half of its stakes in its Tunisian oil exploration licences to accelerate their development, its CEO told Reuters last November.

Additional reporting by Tarek Amara in Tunis, Stephen Jewkes in Milan; editing by Louise Heavens and David Gregorio


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