Shell has agreed to sell 16.67 percent of its non-operational stake in the LNG project in the North West Shelf of Australia to XRG, a subsidiary of the international energy investment company ADNOC. The base value of this deal is $1.45 billion, which will be executed along with customary adjustments and contingent payments related to specific milestones. Buyers will also address decommissioning obligations and provide financial security for it.
Deal Details
Further details of this deal indicate that Shell intends to derive added value from this mature and non-operational asset and focus on integrated gas projects. Cederic Cremers, President of Shell's Integrated Gas division, stated: "We take pride in our role as a founding partner in the North West Shelf, and this project has played an important role in the development of Australia's energy." Shell has also announced that it still plans to increase LNG sales by 4 to 5 percent annually until 2030.
LNG Market Status in Australia
In Australia, Shell operates the QGC and Prelude FLNG projects and is developing the Crux project. The company also holds stakes in Arrow Energy and the Gorgon gas project. In 2023, Shell sold its stake in the proposed Browse gas development, which utilized the infrastructure of the North West Shelf.
This deal allows XRG to enter the Australian LNG market, a year after the company withdrew from efforts to acquire Santos. The effective date of this deal will be January 1, 2026, and it is expected to be finalized in 2027, subject to regulatory approvals and other prerequisites.
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