Shell to sell Gulf of Mexico fields to W&T Offshore, Inc.
Shell announced today that it has agreed to sell its interest in six Gulf of Mexico oil and gas fields to W & T Energy VI, LLC, a wholly owned subsidiary of W&T Offshore Inc., for $450 million, with an effective date of September 1, 2010, as part of an ongoing portfolio restructuring and focus on capital efficiency.
“We are focusing our investment on the most promising growth opportunities and that means selling some fields that no longer fit our strategy,” said Marvin Odum, Director Upstream Americas. “This is part of our plan to divest $7-8 billion in assets worldwide in 2010 and 2011.”
The divested fields are Tahoe, Southeast Tahoe, Droshky, Marlin and Dorado, and a Gulf of Mexico producing shelf property, and are predominately mature gas fields. These fields produce some 18,000 barrels of oil equivalent per day (boe/d) and have proved reserves of some 27 million barrels of oil equivalent (net to Shell’s interest). A definitive agreement has been signed for all fields except for one of the fields, a Gulf of Mexico producing shelf property and associated assets, which is the subject of a Letter of Intent and is currently anticipated to close before year-end.
Shell continues to make significant investments in the deep water Gulf of Mexico, where the company currently produces some 230,000 barrels of oil equivalent per day. Perdido, the most recent addition to the Shell Deep Water portfolio, began production earlier this year. Shell recently took the final investment decision on the 100,000 boe/d Mars B deepwater development (Shell 71.5%). Shell has also recently announced the potential for two new 100,000 boe/d deep water production hubs at the Appomattox (Shell 80%) and Vito fields (Shell 55%); following successful exploration and appraisal work on those prospects.
Shell Media Relations
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Shell Investor Relations
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Notes to editors
The assets being divested include:
Tahoe (Shell 70%) & SE Tahoe (Shell 100%) fields
Main Pass 252 Complex & Bud Pipeline (Shell 100%)
Non-operated position in the Marlin (various Shell ownership 11.5% – 25%) & Dorado oil assets (Shell 25%)
A 6.25% over-riding royalty interest in the Droshky field
Subject to Letter of Intent:
Gulf of Mexico producing shelf property and associated assets (Shell 64.3%)
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