Shell drops Gabon onshore assets

LIBREVILLE, March 24, 2017 – Shell on Friday announced it had reached an agreement with Carlyle Group unit Assala Energy Holdings on the sale of its onshore assets in Gabon.

The transaction, valued at USD 587 million, will see Shell divest both fields and related infrastructure. The company will not only let go of the five fields it operates, Rabi, Toucan/Robin, Gamba/Ivinga, Koula/Damier and Bende/M’Bassou/Totou, but also sell its participation interests in Atora, Avocette/M’Boukou, Coucal and Tsiengui West.

The associated infrastructure it is shedding includes the Rai-to-Gama pipeline system and the Gamba Southern export terminal. Production from Shell’s onshore Gabon assets averaged 41,000 bopd last year.

“Shell is very proud of the strong legacy we have built in Gabon over the past 55 years. The decision to divest was not taken lightly, but it is consistent with Shell’s strategy to concentrate our Upstream footprint where we can be most competitive. Shell will continue to pursue opportunities in Sub Saharan Africa,” Upstream Director Andy Brown said in a press release.

The deal, which will close in mid-2017, will result in a USD 53-million impairment charge that Shell will book in its first-quarter results.

With the divestment, Shell follows in Total’s footsteps. At the end of February, the company reached a USD 350-million deal with Perenco on the sale of its wholly owned subsidiary Total Participations Petrolières Gabon.

As a result, the company will divest its interests in the Grondon, Gonelle, Barbier and Mandaros fields in the offshore Grondin area. Total Gabon, while still holding a majority shareholding in the mentioned fields, will hand operatorship to Perenco.

The deal with Perenco also means the sale of stakes in Girelle, Pageau and Hylia fields in the offshore Torpille area, with Total Gabon letting go of its operatorship.

The Coucal, Avocette and Atora onshore fields are also included in the sale, as is the 18-inch Rabi-Coucal-Cap Lopez pipeline. Total Gabon will hold on to its 100% ownership of the Cap Lopez oil terminal.

Finally, Perenco will take over Total Gabon’s 18% stake in the onshore Igongo field, with the latter additionally shifting to a 32.9% non-operating stake in the Rabi field.

Read our latest insights on: