By WILL KENNEDY and EDUARD GISMATULLIN
Royal Dutch Shell, Europes largest oil company, will
exit the Wheatstone LNG project in Australia after selling
its interests for $1.14 billion to state-run Kuwait Foreign
Shell, which had been involved in seven liquefied natural gas
projects in the
country, will concentrate investment away from the Chevron
Corp.-led venture in Western Australia, it said. It will sell
its 8% stake in the Wheatstone-Iago fields and 6.4% in the LNG
plant to Kufpec, as the
state-run Kuwait company is known.
Shell will remain a major player in Australias
energy industry, Shell CEO Ben van Beurden said in the
statement. However, we are refocusing our investment to
where we can add the most value with Shells capital and
The Anglo-Dutch company, which planned to invest about $50
billion in Australian LNG
, has been reviewing project
s worldwide after capital
expenditure rose to record $44 billion last year. Van
Beurden, who took charge at the start of the year, may step
up assets sales after Shell said Jan. 17 that fourth-quarter
earnings will fall to the lowest since 2009.
The Hague-based company also said that its examining
possible job cuts at its Australian Arrow Energy Ltd. unit.
Shell together with its partner PetroChina Co., Chinas
biggest listed oil and gas producer, delayed an investment
decision into the LNG project
after costs in Australia
The sale to Kufpec, which already had stake in Wheatstone LNG
and nearby fields, will not impact the projects
existing commercial agreements, Shell said.
This transaction is consistent with Kufpecs
strategy of investing in projects that have strategic tie-ins
with the Kuwaiti oil sector, the Kuwait company CEO
Sheikh Nawaf Saud Al-Sabah said.
Wheatstone LNG, which will ship 8.9 million tpy of LNG
, is due to start production in
2016. The partners, which also include Apache Corp. and
Kyushu Electric Power Co., started construction
of the plant in 2012.
will supply the fuel to
customers in Asia, such as Japans Tokyo Electric Power
Co., Chubu Electric Power Co. and Tohoku Electric Power Co.