Royal Dutch Shell Plc is lining up assets for a $30b divestment program that may extend from the US and Trinidad to India following its record takeover of BG Group Plc, according to people with knowledge of the matter, Bloomberg reported.
Raising money through divestments is crucial for Shell after the BG purchase wiped out more than $10b its cash last year. Europe’s largest oil company – by market value – sold $20b of assets in 2014 and 2015 combined, Shell CEO Ben Van Beurden said in February. Of the $30b in disposals targeted for 2016-2018, less than $10b will come in this year while the market remains weak, he added.
Shell might face difficulties in finding potential buyers as the business environment has not been in its favor for a long time following low oil and gas prices, according to an analysis published by Zacks.
The Anglo-Dutch company entered Trinidad’s Atlantic liquefied natural gas project in 2014 with the purchase of stakes from Repsol SA. In India, Shell has gained operatorship of the Tapti and Panna-Mukta fields off the country’s west coast. In the US, Shell’s interests in a network of pipelines that carry both crude and oil products will be a focus for divestments.