Shell Offshore Inc, a subsidiary of Shell plc, has agreed to sell its 100% interest in Shell Onshore Ventures LLC, which holds a 51.8% interest in Aera Energy LLC, to IKAV. The international IKAV Group is an asset management group invested in the energy sector.
Headquartered in Bakersfield, California, Aera Energy LLC operates as an independent company. The company operates approximately 13,000 wells in California’s San Joaquin Valley. It produces oil and gas.
The transaction is worth approximately $2 billion. In addition, there are additional contingent payments based on future oil prices.
The transaction has an effective date of October 1, 2021 and is expected to close in the fourth quarter of 2022. In addition, Shell has obtained and will maintain its current oil marketing agreement for a period of at least five years after the sale is completed.
Zoe Yujnovich, Shell’s Director of Upstream, says:
“This move supports our strategy to create a resilient and competitive portfolio by focusing on positions with high growth potential and a strong integrated value chain.”
Shell’s Powering Progress Strategy
Shell is a leading energy company in the United States. It has interests in 50 states and employs over 12,000 people. Shell’s U.S. portfolio of operated companies and interests includes multiple businesses. This includes the exploitation of oil, natural gas, petrochemicals and other refined products. Its portfolio also includes renewable energies such as wind and solar power.
Shell’s Powering Progress strategy is based on three pillars (Growth, Transition and Upstream). Each of them contributes to the company’s energy transition plans. Shell’s Upstream business plays a key role in the Powering Progress strategy through a more focused, competitive and resilient portfolio. This activity allows it to supply energy while financing distributions to shareholders and the energy transition.
