Shell buys offshore wind developer in renewable power expansion bid

Shell has agreed to buy French offshore wind developer Eolfi SA. Company announces the commencement of trading in the next tranche of its share buyback programme. Company introduces the publication of a quarterly update, starting with the third quarter 2019. Completion follows receipt of all necessary regulatory consents. It continuing its expansion into renewable power. Company has taken the final investment decision (FID) for the PowerNap deep-water project in the US Gulf of Mexico. completed the sale of its shares in Shell Olie-og Gasudvinding Danmark B.V. (SOGU), holding a 36.8% non-operating interest.

The oil major is boosting spending on low-carbon energy as it faces pressure to address the risks climate change. Libra Consortium announced today the final investment decision to contract the Mero-2 floating production. Shell Oil Products US (Shell), a subsidiary of Royal Dutch Shell plc announced it has reached an agreement. PowerNap is a subsea tie-back to the Shell-operated Olympus production hub. Storage and offloading (FPSO) vessel to be deployed at the Mero field offshore Santos Basin in Brazil. $1.0 billion consideration plus the value of hydrocarbon inventory, crude oil supply and product offtake agreements.

Dorine Bosman, vice president of offshore wind for Shell says “Eolfi has been a pioneer of floating wind development”.

Shell’s biggest renewable bets so far have been on acquiring retail customers. The company has entered into an irrevocable, non-discretionary arrangement with a broker. Jessica Uhl, CFO of Royal Dutch Shell said: “In response to feedback from investor community company introducing the new quarterly process”. The acquisition supports Saudi Aramco’s plan to increase the complexity and capacity of its refineries, as part of its long-term downstream growth strategy. Danish Underground Consortium (DUC), to Norwegian Energy Company ASA (Noreco) for a consideration amount of $1.9 billion.

It through the purchase of a UK utility and an electric car charging company. The aggregate maximum consideration for the purchase of A ordinary shares and/or B ordinary shares under the next tranche is $2.75 billion. This is a further step in Shell’s ongoing journey to enhance disclosures and increase transparency. For Shell, the sale is part of an ongoing effort integrating its refining portfolio with Shell Trading hubs and chemicals operations. Eolfi has a foothold in one of the most developed markets for floating wind projects. This is an update to the third quarter 2019 outlook provided in the second quarter results announcement on August 1, 2019.

The project is expected to start production in late 2021 and produce up to 35,000 barrels of oil equivalent per day (boe/d) at peak rates. Completion of the sale follows receipt of regulatory approval by the Danish authority. The FPSO will have a capacity to process up to 180,000 barrels of oil per day. It could give Shell the experience and expertise it needs to boost investments in the technology. Saudi Arabian Oil Company and Shell Saudi Arabia Limited announced that Saudi Aramco was to acquire Shell’s 50% share. It is anticipated to have a forward-looking break-even price of less than $35 per barrel1.

The transaction’s effective date is 1 January 2017. The consortium plans four new production systems to be deployed in the Mero field. It currently estimated to contain more than 85 million barrels of oil equivalent recoverable resources. It’s ability to scale-up will help make electricity a significant business for Shell. Shell is the largest foreign producer in Brazil, which has become a heartland for us. The divestment aligns with Shell’s strategy to reshape refining efforts towards a smaller, smarter refining portfolio focused on further integration.

Winning in Wind. By 2030, installed capacity of floating offshore wind could reach 1.2 gigawatts across seven countries. The impacts presented here may vary from the actual results and are subject to finalisation of the third quarter 2019 results. Presented earnings impacts relate to earnings on a current cost of supplies basis, attributable to shareholders excluding identified items. France becoming the biggest market, according to a forecast from BloombergNEF. PowerNap further strengthens Shell’s leading position in the Gulf of Mexico. Shell Trading and Supply and Shell Energy Europe Limited will retain oil and gas lifting rights from the DUC.

Equinor ASA has dominated the sector, winning the right to build the world’s biggest offshore wind farm. The company’s intention remains to buy back at least $25 billion of its shares. The head of Shell’s business unit that includes low-carbon investments. As one of Shell’s Core Upstream themes, Deep Water is set to generate robust cash flow for decades to come. The oil major could become the largest electricity company in the world within 15 years. Shell retains its Downstream presence in Denmark through A/S Dansk Shell, which includes the Fredericia refinery. Wind will be a key component of that strategy.

“We believe the union of Eolfi’s expertise and portfolio with Shell’s resources”, Dorine Bosman said.

In January Shell said it’s teaming up with a pension fund to bid for a Dutch utility called Eneco. Production is expected to be between 930 and 960 thousand barrels of oil equivalent per day. On last On Thursday, CFO Jessica Uhl said bids for the company were due within a week. The network of Shell-branded retail stations in Denmark will continue to be operated by DCC. Shell’s overall budget for “new energies” is about $2 billion a year, less than 10% of its capital expenditure budget. The company completed the previous tranche of its share buyback programme. Though it’s expected to rise to as much as $3 billion by 2021.

Shell didn’t disclose terms for the purchase of Eolfi. LNG liquefaction volumes are expected to be between 9.00 and 9.30 million tonnes. The company has more than 65 employees in Paris, Lorient, Marseilles and Montpellier. The transaction is an agreement by Shell Overseas Holdings Limited with Altinex AS. It has developed over 200 onshore and offshore renewable energy projects in five countries, according to a statement from Shell. The transaction includes mechanisms to adjust the consideration for actual over-or underproduction above or below certain thresholds. The deal is expected to close in December.

Facebook Comments