Sydney: Shell said on Saturday it had signed a deal to sell its 27 per cent stake in the long-delayed Browse gas project off Western Australia to BP, without disclosing a price tag.
The estimated $20.5 billion Browse project, Australia’s largest untapped gas resource, has been stuck on the drawing board for years but is now being considered to replace ageing gas fields to supply the North West Shelf LNG (liquefied natural gas) plant.
In a statement issued on Saturday, Shell Australia said it “regularly assesses its portfolio to inform capital allocation and maximise returns and performance however, the Browse asset is no longer a strategic fit in the context of Shell’s global portfolio”.
“Browse remains an important Australian resource which if developed will provide much needed energy to customers as the energy market transitions towards lower carbon energy,” it said.
BP was not immediately available for comment on the deal, which, if it goes ahead, will mean it overtakes Woodside, operator of Browse, as the biggest stakeholder in the project with a total holding of 44.3 per cent.
No deal price was mentioned by Shell.
In 2012, Japan’s Mitsui & Co and Mitsubishi together paid $2 billion for a 14.4 per cent stake in Browse, while PetroChina bought a 10.67 per cent stake for $1.63 billion.
Operator Woodside Energy Group Ltd owns 30.6 per cent.
The Sydney Morning Herald had reported earlier this month that BP was in talks to buy Shell’s stake in the carbon-intensive development, in a sign that the two global oil and gas producers had differing views about the project.
Woodside last week played down concerns over the status of the long-stalled Browse project after the company reported a decline in first-quarter sales revenue relative to the December quarter.