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Oil Majors Show Interest In Cyprus Offshore Bid Round

Oil Majors Show Interest In Cyprus Offshore Bid Round

The exploration race for Mediterranean…

Repsol to Sell LNG Assets to Shell in Attempt to Reduce Debt

Ever since Cristina Kirchner and her Argentine government illegally seized Repsol’s majority share of the energy company YPF last April, the Spanish company has been under a lot of pressure to reduce its debt and retain an investment grade credit rating.

Part of this plan includes the sale of liquefied natural gas (LNG) assets in Canada, Trinidad and Tobago, and Peru.

The LNG sale attracted interest from several companies around the world, including Sinopec of China, Gazprom from Russia, GAIL Ltd. of India, and France’s GDF Suez.

Reuters has been told by inside sources that the winning bid was made by Royal Dutch Shell, and that Repsol will confirm the sale late on Tuesday.

Related article: Panama Canal to become Major LNG Thoroughfare?

No specific details of the offer were given, however it was noted that the sale to Shell did not include the Canadian assets, which have actually been valued negatively due to the shale gas boom just south of the border in the US.

The completion of the sale will massively reduce Repsol’s debt, which was listed at €5 billion ($6.61 billion) at the end of September 2012.

Repsol is also still trying to sue the Argentine government for compensation over the seizure of its YPF shares.  Repsol is looking for at least $10 billion, but the court case could drag on for many years before a decision is made.

By. Charles Kennedy of Oilprice.com


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