Shell share price: Group offloads Eagle Ford assets for $639 million

on May 22, 2014
Updated: Apr 9, 2020
Listen, Thursday, May 22: Royal Dutch Shell (LON:RDSA) has sold oil and gas properties in the Eagle Ford in south Texas to US producer Sanchez Energy Corp (NYSE:SN) for $639 million (£379 million). The sale is part of Shell’s efforts to restructure its resources plays in North America as it looks to cut exposure to US shale.

Shell’s share price has added more than one percent in London so far today.
**Shell sells Eagle Ford assets**
The European oil major said yesterday in a statement that it had agreed to sell its 100 percent working interest in approximately 106,000 net acres in Dimmit, LaSalle, and Webb Counties, Texas to Houston-based Sanchez Energy Corp.
The sale, which includes about 176 operated producing wells and associated field facilities and infrastructure, will fetch approximately $639 million. Shell said that the assets had delivered net production of about 24,000 barrels of oil equivalent per day during the first quarter with approximately 60 percent crude and natural gas liquids.

Are you looking for signals & alerts from pro-traders? Sign-up to Invezz Signals™ for FREE. Takes 2 mins.

Sanchez announced in a separate statement that the additional acreage was expected to bring the company’s total position in the Eagle Ford to about 226,000 acres.
**Reorganising US assets**
Shell explained that the sale was part of the ongoing restructuring of the company’s resources plays in North America, with the group having already divested its acreage position in the Mississippi Lime in Kansas, its Utica shale position in Ohio and a portion of its acreage in the Sandwash Niobrara basins in Colorado.

In March, Shell unveiled plans to reorganise its American shale gas and oil operations into a single business in an attempt to improve their performance. (Shell share price: Americas upstream spending cut by a fifth)

International oil and gas producers such as Shell and UK peer BP Plc (LON:BP) have been struggling to keep pace with local independent companies which have spearheaded the US shale revolution. Earlier this year BP also announced plans to reorganise its onshore operations in the US, noting that it would create a separate standalone business to manage its oil and gas assets in the lower 48 states. (BP share price: Company to separate US onshore oil and gas assets)

Shell, whose earnings slumped 44 percent to $4.5 billion in the first quarter, has also stepped up divestments outside North America this year, having offloaded a string of downstream operations in Australia and Italy, as well stakes in a liquefied natural gas project in Western Australia and an interest in an oilfield offshore Brazil.
**As of 10:16 BST, buy Shell shares at 2375.00p.**
**As of 10:16 BST, sell Shell shares at 2374.50p.**


Want easy-to-follow crypto, forex & stock trading signals? Make trading simple by copying our team of pro-traders. Consistent results. Sign-up today at Invezz Signals™.

Learn more
Energy & Power Stock Market