Royal Dutch Shell says it has signed two agreements to sell its undeveloped oilsands interests in Canada for a net consideration of US$7.25 billion.
Under the first agreement, the Anglo-Dutch energy giant will reduce its 60 per cent interest in the the Athabasca Oil Sands Project to 10 per cent and sell its 100 per cent interest in the Peace River Complex in-situ assets, including Carmon Creek, and a number of undeveloped oilsands leases in Alberta to a subsidiary of Canadian Natural Resources Ltd.
Shell says it would remain the operator of the project’s Scotford upgrader and Quest carbon capture and storage project. Canadian Natural would be expected to operate Athabasca’s upstream mining assets.
Shell says the deal is worth approximately US$8.5 billion (C$11.1 billion), comprised of $5.4 billion in cash plus around 98 million Canadian Natural shares currently valued at $3.1 billion.
Under the second agreement, which is also subject to regulatory approvals, Shell and Canadian Natural will jointly acquire and own Marathon Oil Canada Corp., which holds a 20 per cent interest in the Athabasca Oil Sands Project, for $1.25 billion each.
The transactions are expected to close in mid-2017, subject to regulatory approvals.