Shell has completed the sale of 22.45% non-operated interest in the Caesar-Tonga asset in the U.S. Gulf of Mexico to Equinor, subject to approval of the lease assignments by the regulator.
Shell announced it had signed an agreement to sell its interest in the Caesar-Tonga asset to Israel’s Delek in April 2019. Subsequently, Norway’s Equinor exercised its right of first refusal under the joint venture operating agreement.
The transaction has an effective date of January 1, 2019. The total cash consideration was $965 million.
Announcing the completion of the sale on Tuesday, Shell said that the transaction represented its focus on strategically positioning the deep-water business for growth and is consistent with its strategy to pursue competitive projects that deliver value in the 2020s and beyond. The sale contributes to Shell’s ongoing divestment program.
Shell is currently the largest leaseholder of oil and natural gas in the US Gulf of Mexico.
The Caesar-Tonga field is located 180 miles (290 kilometers) south-southwest of New Orleans in the Green Canyon area and is one of the largest deepwater resources in the US Gulf of Mexico.
First oil from the Caesar-Tonga field was produced in March 2012. Anadarko completed its eighth development well at the field in the second quarter of 2018. The well was tied back to the Constitution Spar and came online in the third quarter of 2018. Total average production at Caesar-Tonga is over 70,000 boe/d.
The field is operated by Anadarko Petroleum Corporation, holder of 33.75% interest. The remaining interest in the asset following the completion of the divestment is distributed between Equinor (46%) and Chevron (20.25%).
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