Royal Dutch Shell has unveiled plans to sell about a third of its stake in Woodside Petroleum for $3.3bn (£2bn).
Shell said it would hang onto its remaining 24.27 per cent Woodside stake for at least a year – but it could sell earlier under certain circumstances such as a full takeover of Woodside.
Woodside operates the massive North West Shelf project in Western Australia which accounts for about 40 per cent of the nation's entire oil and gas production.
Shell said it was selling 10 per cent of Woodside at A$42.23 a share in a sale underwritten by investment bank UBS.
UBS would now expected to offer the stock to institutions, analysts said, adding the move was a surprise because the stake could have been offered in one piece to a potential bidder.
"Any potential bidder is going to have to at least stump up A$50-plus to bid for Woodside," said David Lennox, resources analyst at Fat Prophet.
Woodside closed flat ahead of the news at A$45.86.
The sale is part of a global effort to improve capital efficiency and simplify the group, Shell said.
City A.M. Reporter