Photo by: Bloomberg
VANCOUVER (miningweekly.com) – British–Dutch multinational oil and gas company Royal Dutch Shell has agreed to sell its entire stake in Calgary, Alberta-based company Canadian Natural Resources in a deal valued at about C$4.3-billion.
Shell has reached agreement with underwriters Goldman Sachs & Co, RBC Capital Markets, Scotiabank and TD Securities, to sell its 97.56-million shares in Canadian Natural, representing about 7.9% of Canadian Natural’s outstanding shares.
Shell indicated that it will use the proceeds from the sale to reduce net debt.
The sale is expected to complete on Wednesday.
In May 2017, Shell announced its exit from the Canadian oil sands and sold most of its in situ and undeveloped oil sands interests in Canada and reduced its share in the Athabasca oil sands project from 60% to 10%. Shell acquired Canadian Natural shares through a C$11.1-billion cash-and-scrip deal, which it said will help its focus on free cash flow, higher returns on capital, and prioritising businesses where it has global scale and a competitive advantage such as integrated gas and deep-water.
Shell continues to be active in Canada, focusing on growing upstream business built around the Montney and the Duvernay shale plays, on a foundation of Foothills sour gas in British Columbia, a successful downstream business anchored in its Sarnia refinery, in Ontario, and its Scotford refinery and upgrader, in Alberta, as well as its two petrochemicals plants near Edmonton. It also has a prospective liqueified natural gas export project in Kitimat, British Columbia.
The announcement sent Canadian Natural’s TSX-listed equity down as much as 3.79% on Tuesday morning to C$43.94 apiece.