Earlier today Shell EP Middle East Holdings (ticker: RDS) agreed to sell the entire share capital of Shell Iraq B.V, which holds its 19.6% stake in the West Qurna 1 Oil Field, for $406 million, to a subsidiary of Itochu Corporation.
Itochu will assume debt of $144 million as part of the transaction. The sale has received the necessary regulatory consent, is expected to complete in the next few days, and has an effective date of December 31, 2015.
Shell has been involved in the West Qurna 1 Oil Field since 2009, and after the sale the venture will continue to be operated by ExxonMobil (ticker: XOM). The oilfield produces approximately 405,000 barrels of oil per day, with expected recoverable reserves of over 20 billion barrels of oil. By exiting West Qurna 1 Oil Field Shell will be able to focus their resources on other assets included in their Iraq profile.
Shell’s other businesses in the country will not be affected by this divestment.
Source: Itochu Corporation
