Royal Dutch Shell has agreed to acquire part of
the LNG portfolio of Spain-based Repsol, the companies
confirmed on Tuesday.
Long rumored, the acquisition includes LNG
assets outside of North America, including supply positions in
Peru and Trinidad & Tobago, for a cash consideration of
$4.4 billion. A Spanish terminal is also in the
Shell will also assume and consolidate balance sheet
liabilities predominantly reflecting leases for LNG ship
charters of currently $1.8 billion. The balance sheet impacts
are subject to final assessment prior to deal completion,
"Shell's world-wide LNG supply position and customer base
means we are uniquely positioned to add value to Repsol's LNG
portfolio, including through Shell's trading capabilities,"
said CEO Peter Voser.
"By optimizing the combined portfolios we will increase our
ability to bring LNG to areas that need it the most, adding
value for Shell, our partners and our customers," he added.
The acquisition will add a new dynamic to Shell's portfolio,
namely LNG capacity in the West Atlantic from Atlantic LNG in
Trinidad & Tobago, and in the East Pacific from Peru LNG.
These additions will complement Shell's existing LNG capacity
in Africa, Asia, Australia, the Middle East and Russia.
The acquisition should add some 7.2 million tpy of LNG
volumes through long-term off-take agreements, including some 4
million tpy of equity LNG plant capacity.
Shell said it expects to add value to this portfolio
by optimizing the new LNG flows with its global
customer base. Subject to successful completion, the new
portfolio is expected to immediately provide additional cash
flow to Shell, with limited on-going capital expenditure
The transaction, which has an effective date of October 1,
2012, is expected to close in the second half of 2013 or early
2014, subject to regulatory approvals and other conditions