Shell Egypt has announced that it entered into a sale and purchase agreement (SPA) for its onshore upstream assets in the Western Desert of Egypt, with a consortium made up of subsidiaries of Cheiron Petroleum Corporation and Cairn Energy PLC, a press release issued by Shell Egypt stated.
The statement added that agreement includes Shell’s interest in 13 onshore concession and its share in Badr El- Din Petroleum Company (BAPETCO). The sale is for a base consideration of US$ 646 million and additional payments of up to $280 million between 2021 and 2024, contingent on the oil price and the results of further exploration.
The agreement is subject to approvals from the government and regulatory. It is expected to complete in the Q2 2021.
On this occasion, Wael Sawan, Shell’s Upstream Director, said: “Today’s announcement is consistent with Shell’s efforts to shift our Upstream portfolio to one that is more focused, resilient and competitive.”
He added that “The deal will deliver value to Shell and to Egypt. 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. It will help Egypt maximize the potential of its onshore assets through new investment, helping secure energy and revenue for years to come.”
For his part, Khaled Kacem, Shell’s Country Chair for Egypt, said: “We are proud of our history as one of the first oil and gas companies in the Western Desert, and as a partner in BAPETCO since its formation almost four decades ago. BAPETCO and the Western Desert concessions continue to provide revenue, jobs and energy for the country, while Egypt’s Modernization Programme will ensure that this will be the case for many years to come. I would like to pay tribute to the staff, stakeholders, partners and authorities who have contributed to the success of this key milestone and towards a deal completion in the near future.”