Shell Signs Agreement with Cheiron & Cairn for Its Interests in Egypt

Source: 3/9/2021, Location: Africa

Shell Egypt and one of its affiliates have signed an agreement with a consortium made up of subsidiaries of Cheiron Petroleum Corporation and Cairn Energy PLC to acquire Shell’s upstream assets in Egypt’s Western Desert for a base consideration of US$646 million and additional payments of up to $280 million between 2021 and 2024, contingent on the oil price and the results of further exploration.

The transaction is subject to government and regulatory approvals and is expected to complete in the second half of 2021.

The package of assets consists of Shell Egypt’s interest in 13 onshore concessions and the company’s share in Badr El-Din Petroleum Company (BAPETCO).

“Today’s announcement is consistent with Shell’s efforts to shift our Upstream portfolio to one that is more focused, resilient and competitive” said Wael Sawan, Shell’s Upstream Director.

“The deal will deliver value to Shell and to Egypt. It will enable Shell to concentrate on its offshore exploration and integrated value chain in Egypt, including seven new blocks in the Nile Delta, West Mediterranean and Red Sea. It will help Egypt maximize the potential of its onshore assets through new investment, helping secure energy and revenue for years to come.”

Note to editors:

1. about Shell in Egypt

Shell Egypt N.V. (SENV) and Shell Austria GmbH (SAG) (together referred to as "Shell" or “Sellers”) are wholly owned by the Royal Dutch Shell plc. Shell has been active in Egypt for over 100 years and remains a leading player in country with investments spanning the value chain. Shell’s integrated portfolio includes exploration, upstream operations, LNG through our Egyptian LNG (ELNG) joint-venture, and the lubricants business through Shell Lubricants Egypt (SLE).

2. The transaction comprises the following assets:

- a 50% non-operator interest Badr El-Din Petroleum Company (BAPETCO)

- Producing assets operated by BAPETCO

- a 100% interest in Obaiyed, North Umbaraka, Badr el Din (BED) fields, Sitra, North Alam El Shawish, and North Matruh

- a 52% interest in North East Abu Gharadig where Shell Egypt is partnered with Apache Abu Gharadig Corporation LDC

- a 40% interest in Alam El Shawish where Shell Egypt is partnered with North Petroleum International Company S.A. and Neptune Energy Alam El Shawish B.V.

- The Shell Egypt-operated onshore exploration assets (100% Shell): South East Horus, West El Fayum, and South Abu Sennan.

3. Shell Egypt has recently acquired seven new offshore concessions

- In the West Mediterranean, North Marina and North Cleopatra in the Herodotus Basin as operator through its subsidiary BG Delta Limited with partners Chevron through its subsidiaries (Noble Energy Egypt I B.V & Noble Egypt Energy II B.V) and Tharwa Petroleum Company S.A.E, and non-operator of North Ras Kanais in partnership with Total E&P Egypt Offshore Western Desert B.V (operator), Tharwa Petroleum Company and Kufpec Egypt Limited.

- In the Red Sea, Shell Exploration & Production (93) BV has acquired two concessions as operator: Block 4 in partnership with Mubadala Petroleum (Red Sea Block 4) Holding RSC Limited and Tharwa Petroleum Company S.A.E., and Block 3 with Tharwa Petroleum Company.

- In the West Nile Delta, BG Delta Limited acquired last year Blocks 4 and 6 as operator in partnership with PICL (Egypt) Corporation LTD and for which seismic activities are already underway.

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