Indications are positive that Shell will progress with
divestment of brownfield assets in Nigeria next year, heightening the
uncertainty in the company’s asset shed out in the country which investors have
criticized as unpredictable.
According to Royal Dutch Shell, 2015 will see the company
divesting its 30 percent stake and partners’ additional 15 percent interest in
unspecified number of operated joint venture assets.
According to a statement from the company, the planned
divestment will translate to $15 billion of liquid cash for the Royal Dutch
Shell in 2015 as it tries to boost cash flow.
Shell’s Upstream Director, Andrew Brown, stated that the oil
company was adopting the divestment programme as part of its global strategy to
raise operations funds in the face of global oil market adversity which has
seen crude prices slumping from over $100 per barrel to about $62 per barrel.
The UNION reports that global oil prices have dropped by
around 30 percent over the past four months, putting heavy pressure on the
balance sheets of oil companies already struggling to cut spending.
“We do have a continuous need to recycle our portfolio. $15
billion is still only a few percent of our total assets and we haven’t got any
plans to refresh that target,” Brown told reporters.
Mr. Brown’s statement came as Shell Petroleum Development
Company of Nigeria (SPDC), a subsidiary of Royal Dutch Shell, declared completion
of the assignment of its 30% interest in Oil Mining Lease 24 (OML24) and
related facilities in the Eastern Niger Delta to Newcross Exploration and
Production.
Total E&P Nigeria Limited (10%) and Nigerian Agip Oil
Company Limited (5%) have also assigned their interests in the lease,
ultimately giving Newcross a 45% interest.
Total cash proceeds for Shell amount to some $600 million.
OML24 covers an area of some 430 sq km and includes the
Awoba, Awoba Northwest and Ekulama fields and related facilities.
The divested infrastructure includes three oil flow-stations
and three gas processing plants, in addition to various oil and gas pipelines.
The divested fields produced on average around 13,000 boed
during the first half of 2014.
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