Skip to main content

Shell sells US Appalachia assets to National Fuel

Published by , Senior Editor
Hydrocarbon Engineering,

Royal Dutch Shell plc, through its affiliate SWEPI LP (Shell), has reached an agreement with publicly listed US energy company National Fuel Gas Co. (NFG), and its subsidiaries, Seneca Resources Co. LLC, National Fuel Gas Midstream Co. LLC, and NFG Midstream Covington, LLC (together National Fuel), to sell its Appalachia shale gas position for US$541 million, subject to closing adjustments.

The transaction has an effective date of 1 January 2020.

The consideration is intended to be paid in cash, but National Fuel has the option to provide up to US$150 million of NFG common stock as consideration. The transaction is part of divesting non-core assets and in line with Shell's Shales strategy which focuses on development of higher margin, light tight oil assets.

"Divesting our Appalachia position is consistent with our desire to focus our Shales portfolio," said Wael Sawan, Upstream Director at Shell. "While we maximise cash in the current environment, our drive for a competitive position in Shales continues. It is a core part of our Upstream portfolio along with the Deep Water and Conventional oil and gas businesses."

The transaction includes the transfer of ~450 000 net leasehold acres across Pennsylvania, with approximately 350 producing Marcellus and Utica wells in Tioga County and associated facilities. The current net production is ~250 million standard ft3/d. The transaction also includes the transfer of the Shell owned and operated midstream infrastructure.

The sale is subject to regulatory approvals and expected to close by end of July 2020.

Read the article online at:

You might also like


Embed article link: (copy the HTML code below):


This article has been tagged under the following:

Downstream news