Shell Begins Sale of U.S. Shale Assets Following Charge
Royal Dutch Shell Plc (RDSA), Europe’s biggest oil company, began a sale of U.S. shale assets after booking a $2.1 billion impairment in the second quarter.
The company will sell its interest in the Eagle Ford project in Texas and plans to open a data room to potential buyers next month, The Hague-based Shell said today in an e-mailed statement. The company also will divest its holding in the Mississippi Lime area in Kansas, it said last week.
The company last quarter booked an impairment charge mostly related to liquids-rich shale exploration in North America. It said in August it will continue losing money producing oil and gas on the continent this year and announced a review of U.S. onshore shale projects.
“Our Eagle Ford leasehold and producing asset offers a valuable growth opportunity for another experienced operator,” Jonathan French, a London-based company spokesman, said in today’s statement. Shell’s shale acreage there contains mostly condensate, with some oil, he said.
Shell held about $24 billion in North American shale assets on its balance sheet as of July. Chief Executive Officer Peter Voser said the following month it planned to cut the number of North American regions where it operates by half to four or five. It has already exited its Mahogany oil-shale research project in Colorado.
Shell stopped drilling in Kansas in May with a view to selling its leasehold, Kelly op de Weegh, a Houston-based spokeswoman, said Sept. 24. The company is selling 600,000 acres there to focus investment elsewhere, French said today by phone.
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