Shell indicated that the acquisition will increase its reserves by 25% (Source: Reuters)
The Dutch oil company Royal Dutch Shell has reached an agreement to acquire the British BG Group for 64.2 billion euros (US $ 217.7 billion). It is the first major merger in the oil sector in more than a decade, according to Reuters, and reduces the difference between Shell and the market leader, the US Exxon Mobil.
The biggest merger this year will give Shell access to multibillion BG operations in Brazil, East Africa, Australia, Kazakhstan and Egypt. They include some of the most ambitious liquefied natural gas in the world projects.
Shell has indicated that the acquisition will increase its oil and natural gas reserves by 25%, increasing production by 20% and also accelerating the company's growth strategy.
The business
Depending on the agreement between the two companies, the shareholders of BG Group will receive a portion of the cash value and the other in Shell's shares, equivalent to 19% of the group formed by the two companies, according to EFE.
Sewn by the chief executive of Shell, Ben van Beurden, and the chairman of BG, Andrew Gould, the agreement comes after the sharp fall in oil prices since June, setting a higher premium on access to proven reserves than on exploitation.
"We were looking for some opportunities, with BG always be at the top of the list of companies with which we wanted to match us," said Van Beurden, Shell, in a conference call, according to Reuters.
The agreement was signed at a time of falling oil prices, but analysts believe that this may be one of the main 2015 business.
Van Beurden said the presence of the two companies in Australia, Brazil, China and the European Union may require detailed discussions with antitrust authorities, but it is unlikely to lead to a sale of assets forced.
In Brazil
According to Shell, the agreement will improve the company's position in Brazil as having reservations and investor. The expectation is that production in the country pass of 52,000 barrels of oil equivalent per day in 2014 for a 550 000 at the end of the decade.
"The combined group will be the main partner next to Petrotrobras, working to ensure that best practices and lessons learned are applied to the group's development in deep waters in Brazil in the coming decades," the statement said Shell.
The company claims to be well established as a producer in deep water, with approximately 10% of its total production coming this kind of project.
In 2013, Shell entered the Libra field. "This experience with Libra, with its hundred years of history in Brazil, give Shell a high degree of confidence in the profitability and growth potential that can be released by the combination of capabilities, portfolio and company relationships with the competitive position of BC in deep water on site, "said in a statement the company.
Companies
The British BG has a $ 46 billion market value, according to Tuesday's closing level, and Shell is valued at $ 202 billion, while Exxon, the largest oil company by market value in the world, was valued at $ 360 billion.
BG Group, the third largest energy company in the UK, has 5,200 employees in 24 countries.
The company was founded in 1997 when British Gas was split in two - BG Group and Centrica. The first became responsible for energy exploration and production, while the second took the energy retail in the UK.
Shell said the acquisition will create a stronger, more competitive company for the shareholders of both companies at a time of "price volatility" of oil.
The executive director of the Dutch company, Ben van Beurden, said today that the initiative is "bold and strategic."