USA: Energy Strategy Shell to Sell Permian Business to ConocoPhillips for 9.5 Billion Dollars
Under a signed agreement between the two parties, Shell will sell its interest in the Permian business to ConocoPhillips. The move is in line with Shell’s ‘Powering Progress’ strategy which aims at developing a more focused and competitive energy portfolio.
The Hague/Netherlands – Shell Enterprises, a subsidiary of Royal Dutch Shell, has reached an agreement for the sale of its Permian business to ConocoPhillips, a leading shales developer in the basin, for 9.5 billion dollars in cash. The transaction will transfer all of Shell’s interest in the Permian to ConocoPhillips, subject to regulatory approvals.
Shell’s Upstream business plays a critical role in the Powering Progress strategy through a more focused, competitive and resilient portfolio that provides the energy the world needs today whilst funding shareholder distributions as well as the energy transition.
The cash proceeds from this transaction will be used to fund 7 billion dollars in additional shareholder distributions after closing, with the remainder used for further strengthening of the balance sheet. These distributions will be in addition to its shareholder distributions in the range of 20-30 % of cash flow from operations. The effective date of the transaction is July 1, 2021 with closing expected in Q4 2021.