\n<\/p>\n
Shell has agreed to buy Canadian shale producer ARC Resources for $16.4bn, five years after Europe\u2019s biggest gas and oil producer sold its US shale business.<\/p>\n
The deal, which includes $13.6bn in cash and shares and taking on ARC\u2019s $2.8bn debt, would be Shell\u2019s biggest acquisition since it bought BG Group a decade ago.<\/p>\n
ARC would add about 370,000 barrels a day of oil and gas to the London-listed company\u2019s production.<\/p>\n
Shell said that the deal would boost production growth from 1% a year to 4% and add 2bn barrels to its proved and probable reserves.<\/p>\n
Analysts and investors have previously said that Shell needed an acquisition, or exploration breakthrough, to bolster its production and reserves due to its ageing existing fields.<\/p>\n
Wael Sawan, the chief executive of Shell since 2023, said the deal to buy Calgary-based ARC, which is focused on the Montney shale basin in British Columbia and Alberta, would make Canada a \u201cheartland\u201d for Shell. He added it would strengthen Shell\u2019s \u201cresource base for decades to come\u201d.<\/p>\n
\u201cWe are accessing uniquely positioned assets and welcoming colleagues that bring deep expertise which, combined with Shell\u2019s strong basin level performance, provides a compelling proposition for shareholders,\u201d he said.<\/p>\n
The move marks a major bolstering of its operations North America, after Shell sold its US shale business in the Permian Basin in Texas to ConocoPhillips in 2021 for $9.5bn.<\/p>\n
ARC mainly produces gas and condensate, a liquid that can be used in refineries to make ethylene, and Shell\u2019s deal marks its latest push to become one of the largest players in liquefied natural gas.<\/p>\n
In 2015, Shell acquired gas group BG, formerly the exploration arm of British Gas, for \u00a347bn in what was then one of the largest takeovers in the oil sector for two decades.<\/p>\n
The company also owns a 40% stake in LNG Canada, a $40bn liquefied fossil gas plant on the west coast of Canada.<\/p>\n
Shell said that it either \u201cowns\u201d or is \u201cinvolved with more than 30% of global LNG capacity, and is the world\u2019s largest trader of the fuel.<\/p>\n
Earlier this year, Sawan said that the company had spent about $2bn buying assets last year that would add about 40,000 barrels a day of new production by the end of the decade.<\/p>\n
\u201cWe think they\u2019re paying a fair valuation given the deep inventory that ARC has and the likelihood of a counterbid to be low,\u201d said Eric Nuttall, a senior portfolio manager at investment group Ninepoint Partners.<\/p>\n
Shell, which is due to report its results for the first quarter on 7 May, is expected to report \u201csignificantly higher\u201d profits from its trading desks due to the market volatility triggered by the Iran crisis.<\/p>\n
Shares in Shell fell 1.8% on Monday.<\/p>\n","protected":false},"excerpt":{"rendered":"
Shell has agreed to buy Canadian shale producer ARC Resources for $16.4bn, five years after Europe\u2019s biggest gas and oil producer sold its US shale business. The deal, which includes $13.6bn in cash and shares and taking on ARC\u2019s $2.8bn debt, would be Shell\u2019s biggest acquisition since it bought BG Group a decade ago. ARC<\/p>\n","protected":false},"author":1,"featured_media":48816,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[24352,18765,2179,4530,5055,13704,24351,948],"class_list":{"0":"post-48815","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-16-4bn","9":"tag-arc","10":"tag-buy","11":"tag-canadian","12":"tag-producer","13":"tag-resources","14":"tag-shale","15":"tag-shell"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/48815","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=48815"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/48815\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/48816"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=48815"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=48815"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=48815"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}