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Royal Dutch Shell (NYSE:RDS.A) is looking to sell its share of the offshore oil and gas joint venture Danish Underground Consortium, in which the Anglo-Dutch oil major’s stake is estimated to be worth up to US$1 billion, Reuters reported on Monday, citing banking sources.
If the sale were to take place, it would mark Shell’s exit from Denmark and further align with the supermajor’s plans to continue divesting assets.
According to Reuters sources, Bank of America Merrill Lynch (BAML) is working on the sale.
Shell holds 36.8 percent in the Danish Underground Consortium (DUC) alongside operator A.P. Moller-Maersk, which owns 31.2 percent, U.S. major Chevron, which has 12 percent, and Denmark’s state-run Nordsøfonden which holds a 20-percent stake.
In September last year, Shell reached an agreement with Dansk Olieselskab ApS for the sale of A/S Dansk Shell in Denmark, which consists of the 70,000-bpd Fredericia refinery and local trading and supply activities, for around US$80 million, including working capital. The sale – which was part of Shell’s strategy to focus its downstream operations on areas where it can be most competitive - completed the oil major’s exit from downstream activities in Denmark.
Shell’s chief financial officer Simon Henry said last week that the group was making “significant progress” on selling another US$5 billion worth of assets.
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In Shell’s earnings release last Thursday, chief executive Ben van Beurden said:
“We are gaining momentum on divestments, with some $15 billion completed in 2016, announced, or in progress, and we are on track to complete our overall $30 billion divestment program as planned.”
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.