Shell to Reduce Woodside Stake to 4.8%

Shell announced November 13 it has entered into an arrangement to further reduce its stake in Australian producer Woodside, and realise roughly US$1.7bn (A$2.2bn).

The Anglo-Dutch supermajor said it had entered into an underwriting agreement with two investment banks, for the sale of 71.6mn Woodside shares, representing 64.0% of its interest in Woodside and 8.5% of the issued capital in Woodside, at a price of A$31.10/share, resulting in total pre-tax proceeds of some $1.7bn. It said the sale is expected to complete on November 14, 2017.

Shell’s finance chief Jessica Uhl said: “This sale is another step towards the completion of our three-year $30bn divestment programme... Proceeds from the sale will contribute to reducing our net debt.”

Upon completion, Shell's remaining Woodside stake will be 4.8% and it has agreed to not divest any remaining shares in Woodside for a minimum of 90 days from completion.

Shell will continue to have a significant presence in Australia through: the QGC LNG export venture (Shell operated, majority interest); producer Arrow Energy (50% owned by Shell); Gorgon LNG (25%);  North West Shelf LNG export venture (16.67%); the Prelude floating LNG project now under development and expected to start exports 2018 (67.5% operated interest); and two non-operated LNG projects that have yet to take any final investment decision, namely Browse (27%) and Sunrise (26.6%)

In November 2010 Shell sold 10% of the issued capital of Woodside, retaining a 24.27% interest in Woodside, which was diluted to 23.08% when Shell decided not to participate in Woodside’s dividend re-investment programme. In mid- 2014, Shell sold its stake down further to 13.28%.

Mark Smedley