The sale of a Shell Plc and Exxon Mobil Corp. oil-production joint venture in California has been pushed back to the first quarter of next year for U.S. regulatory approvals, the companies said on Dec. 8.
German asset manager IKAV in September agreed to pay $4 billion for Aera Energy, a Shell-Exxon business that produces nearly 25% of California's oil output. The firms have been shedding older properties to focus on more lucrative assets.
The sale, which originally was to close this month, is pending review by the Committee on Foreign Investment in the United States, which weighs national security risks of sales to foreign-owned companies. The closing is expected by the end of the first quarter next year, said Patrick Evans, a spokesperson for IKAV.
Financing has not been an issue and "IKAV is attracting strong interest from investors, and we are currently reviewing several additional market opportunities," said Evans.
Shell owns a 51.8% stake and Exxon the remainder of the 25-year-old Bakersfield, Calif., venture that pumped about 95,000 bbl of oil and gas per day last year. A Shell spokesperson confirmed the delay.
The two companies will split the $4 billion purchase price. Shell has said it faces a $300 million to $400 million impairment charge on the deal.
Recommended Reading
Gunvor Group Inks Purchase Agreement with Texas LNG Brownsville
2024-03-19 - The agreement with Texas LNG Brownsville calls for a 20-year free on-board sale and purchase agreement of 0.5 million tonnes per annum of LNG for a Gunvor Group subsidiary.
CERAWeek: LNG to Play Critical Role in Shell's Future, CEO Says
2024-03-19 - Sawan said LNG will continue to play a critical role adding that LNG currently makes up around 13% of gas sales but was expected to grow to around 20% in the coming 15 to 20 years.
CoolCo, GAIL Enter Long-term LNG Agreement
2024-05-16 - CoolCo and GAIL’s agreement is intended to secure long-term LNG supply in India’s market, with GAIL having an option to extend the 14-year agreement by another two years.
Sempra Targets Summer 2025 for Commercial Start of ECA LNG Phase 1
2024-03-06 - Sempra is targeting the summer of 2025 as the commercial operations date for its 3.25 mtpa (0.43 Bcf/d) nameplate capacity Energía Costa Azul LNG Phase 1 project, located in Ensenada in Baja California, Mexico.
NextDecade Targets Second Half of 2024 for Phase 2 FID at Rio Grande LNG
2024-03-13 - NextDecade updated its progress on Phase 1 of the Rio Grande LNG facility and said it is targeting a final investment decision on two additional trains in the second half of 2024.