Shell sells stake in Brazilian oil field for £600m

Suzie Neuwirth
ROYAL Dutch Shell yesterday sold a 23 per cent stake in an oil project offshore Brazil for $1bn (£600m), ahead of today’s fourth-quarter results which the oil major had warned would reveal “significantly” lower profits.

The FTSE 100-quoted company sold part of its holding in the Parque das Conchas project to Qatar Petroleum International, the investment arm of state-owned oil company Qatar Petroleum. Last month, Shell closed a deal to take up its pre-emption rights in the project and bought an additional 23 per cent stake, bringing its interest up to 73 per cent.

It is understood that yesterday’s deal is not part of the company’s strategy to divest non-core assets but was to enable Shell to bring a strategic partner into the project.

Shell will continue to operate the project with a 50 per cent working interest. Parque das Conchas currently produces 50,000 barrels of oil per day, equating to just 0.4 per cent of Shell’s global production.

Shell is also looking to sell a stake in the Houston to Houma oil pipeline in Louisiana, according to reports. The pipeline is valued at around $3bn, with Shell seeking to raise up to $1bn.

Earlier this month, Shell warned that fourth-quarter earnings would fall to $2.9bn, down from $5.6bn in the same quarter the previous year. It blamed the decline on the current oil and gas prices and the challenging European refining market.