Royal Dutch Shell Plc entered into an agreement to sell upstream assets in Egypt’s Western Desert to Cheiron Petroleum Corp. and Cairn Energy Plc for up to $926 million, the company said on March 9.
The deal includes Shell Egypt’s stake in 13 onshore concessions and its share in the Badr El-Din Petroleum Co. (BAPETCO). It is subject to government and regulatory approvals and is expected to be completed in the second half of 2021, the statement said.
It sets a base price of $646 million, with additional payments of up to $280 million between 2021 and 2024, subject to the oil price and exploration results.
“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,” the company said.
Unlike most U.S. producers, Diversified, which this month changed its name from Diversified Gas & Oil, does not drill new wells, but buys mature gas fields and focuses on slowing their decline rates.
The divestiture primarily comprise natural gas-producing properties in the western Delaware Basin of the Permian and also include a small undeveloped acreage position, Callon Petroleum said.
Its latest pilot project includes a deal with electric and gas utility Xcel Energy to buy natural gas for its Colorado customers produced by Crestone Peak Resources and certified as “responsibly sourced” by Project Canary.