Shell, through its Shell Canada Energy, Shell Canada and Shell Canada Resources subsidiaries, has signed two agreements on the divestment of its oil sands interests in Canada for net consideration of US$7.25bn.
Under the terms of the first agreement, Shell will sell to Canadian Natural its entire 60% interest in the Athabasca Oil Sands Project (AOSP), its 100% interest in the Peace River Complex in-situ assets, including Carmon Creek, and a number of undeveloped oil sands leases in Alberta, Canada. The consideration to Shell from Canadian Natural is approximately US$8.5bn (C$11.1bn). Canadian Natural is one of Canada’s largest energy companies and a leader in the oil sands.
Under the second agreement, Shell and Canadian Natural will jointly acquire and own equally Marathon Oil Canada Corporation (MOCC), which holds a 20% interest in AOSP, from an affiliate of Marathon Oil Corporation for US$1.25bn each, to be settled in cash. Shell will then retain a 10% interest in the AOSP. The company will also remain as operator of AOSP’s Scotford upgrader and Quest carbon capture and storage (CCS) project.
The transactions are expected to close mid-2017, subject to customary closing conditions and adjustments and regulatory approvals.