Shell Exploring Options to Divest its Non-Operated Interests in Malaysia’s Baram Delta
Mar 12, 2021
KUALA LUMPUR – As part of its continuous global portfolio rationalisation, Shell has decided to explore its options to divest its non-operated interests in the Amended 2011 Baram Delta EOR Production Sharing Contract (PSC) and the SK 307 PSC. The assets located offshore Sarawak, Malaysia, are operated by PETRONAS Carigali Sdn. Bhd. and Sarawak Shell Berhad is a non-operating partner. This decision is in line with the Shell Group’s strategy for its Upstream business to become more focused and to increase its resilience and competitiveness. Shell Malaysia remains committed to supporting the Operator in delivering safe and smooth operations until completion of a sale to a credible buyer.
Malaysia remains an important country to the Shell Group with a continued strong presence in its upstream, gas-to-liquids, downstream and business operations sectors. The upstream business in Malaysia has been identified as one of Shell Upstream’s nine Core Performance Units worldwide. Shell has been a partner to the nation’s progress over its 130 years of operations in the country, contributing to the success of its energy industry, the development of Malaysian talent, and communities, and the company will continue to play an important role in powering Malaysia’s future with cleaner, innovative and competitive energy solutions.
About BARAM DELTA
The Amended 2011 Baram Delta EOR PSC
PETRONAS Carigali holds a 60% equity interest in the Amended 2011 Baram Delta EOR Production Sharing Contract (PSC) and is operator, with Sarawak Shell Berhad holding the remaining 40% equity interest. The Amended 2011 Baram Delta EOR PSC was signed in 2016, to extend the life and increase the recovery factor of the Baram Delta. The (Amended) 2011 Baram Delta EOR PSC comprises the Bokor, Baronia, Fairley Baram, Bakau and Siwa oil fields and Tukau Timur and Baronia gas fields.
PETRONAS Carigali holds a 50% equity interest in the SK307 PSC and is operator, with Sarawak Shell Berhad holding remaining 50% equity interest. The SK307 PSC was signed in 1997 and currently has production from Baronia Barat oil field.
About Shell – www.shell.com.my
Shell is a global leader in power, energy, and gas technology and is working to meet increasing energy demand and supply challenges by delivering smarter products and cleaner energy, infrastructure, and by developing new energy sources while addressing the impact on the environment. Malaysia is one of Shell’s heartlands. The history of Royal Dutch Shell in Malaysia started about 130 years ago. Shell currently has a strong market presence in the upstream, gas-to-liquids, downstream and business operations sectors in Malaysia. The company is also driven towards contributing to the local talent pipeline, while playing its part in contributing towards the communities and the society through its various flagship social investment activities.
For further Media Enquiries, please contact:
Head of External Relations, Shell Malaysia
The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate legal entities. In this announcement “Shell”, “Shell Group” and “Royal Dutch Shell” are sometimes used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to Royal Dutch Shell plc and its subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by identifying the particular entity or entities. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as used in this announcement refer to entities over which Royal Dutch Shell plc either directly or indirectly has control. Entities and unincorporated arrangements over which Shell has joint control are generally referred to as “joint ventures” and “joint operations”, respectively. Entities over which Shell has significant influence but neither control nor joint control are referred to as “associates”. The term “Shell interest” is used for convenience to indicate the direct and/or indirect ownership interest held by Shell in an entity or unincorporated joint arrangement, after exclusion of all third-party interest. This announcement contains the following forward-looking Non-GAAP measures: Adjusted Earnings, Cash capital expenditure, Underlying operating expenses, and Divestment proceeds. We are unable to provide a reconciliation of the above forward-looking Non-GAAP measures to the most comparable GAAP financial measures because certain information needed to reconcile the above Non-GAAP measure to the most comparable GAAP financial measure is dependent on future events some which are outside the control of the company, such as oil and gas prices, interest rates and exchange rates. Moreover, estimating such GAAP measures consistent with the company accounting policies and the required precision necessary to provide a meaningful reconciliation is extremely difficult and could not be accomplished without unreasonable effort. Non-GAAP measures in respect of future periods which cannot be reconciled to the most comparable GAAP financial measure are calculated in a manner which is consistent with the accounting policies applied in Royal Dutch Shell plc’s financial statements.
This announcement contains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) concerning the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Royal Dutch Shell to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as “aim”, “ambition”, ‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘goals’’, ‘‘intend’’, ‘‘may’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘plan’’, ‘‘probably’’, ‘‘project’’, ‘‘risks’’, “schedule”, ‘‘seek’’, ‘‘should’’, ‘‘target’’, ‘‘will’’ and similar terms and phrases. There are a number of factors that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this announcement, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for Shell’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; (m) risks associated with the impact of pandemics, such as the COVID-19 (coronavirus) outbreak; and (n) changes in trading conditions. No assurance is provided that future dividend payments will match or exceed previous dividend payments. All forward-looking statements contained in this announcement are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Additional risk factors that may affect future results are contained in Royal Dutch Shell’s Form 20-F for the year ended December 31, 2019 (available at www.shell.com/investor and www.sec.gov). These risk factors also expressly qualify all forward-looking statements contained in this announcement and should be considered by the reader. Each forward-looking statement speaks only as of the date of this announcement, March 12, 2021. Neither Royal Dutch Shell plc nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this announcement.
We may have used certain terms, such as resources, in this announcement that the United States Securities and Exchange Commission (SEC) strictly prohibits us from including in our filings with the SEC. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov.