Yahoo Finance Shell (SHEL) Concludes the Sale of Baram Delta Offshore
Shell plc’s SHEL unit, Sarawak Shell Berhad, completed the sale of its non-operated stake in two offshore production sharing contracts (PSCs) to Petroleum Sarawak Exploration & Production in the Baram Delta, Malaysia.
According to Shell, the sale comprises non-operated shares in the SK 307 production sharing contract (SK307 PSC) and the amended 2011 Baram Delta EOR production sharing contract (BDO PSC), totaling 40% and 50%, respectively. The operator, Petronas Carigali, is the owner of the remaining portions in both PSCs.
In the BDO PSC prior to the sale, Shell controlled the remaining 40% of the stock, while Petronas maintained a 60% ownership stake. According to the London-based super major, the BDO PSC was signed in 2012, and amended in 2016 and 2019 to maximize the recovery of the Baram Delta and extend its life.
Following regulatory permission from Malaysia Petroleum Management, which Petronas serves as the custodian of in Malaysia, the deal finally closed with effect from Jan 1, 2023. This divestiture is consistent with Shell's efforts to concentrate its upstream portfolio.
Malaysia continues to be one of Shell's eight core upstream locations worldwide, while having a strong presence in the gas-to-liquids, downstream and business services sectors. The company remarked that Shell now has 19 PSCs in Malaysia as a result of this divestiture.
Shell announced in September 2022 that it would partner with Petronas and invest in the Rosmari-Marjoram natural gas development off Sarawak, Malaysia.
Zacks Rank & Key Picks
Currently, Shell carries a Zack Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks for investors interested in the energy sector are CVR Energy CVI and Par Pacific Holdings Inc. PARR, both currently sporting a Zacks Rank #1, and Valero Energy Corporation VLO, carrying a Zacks Rank #2 (Buy).
CVR Energy, a diversified holding company with its main office in Sugar Land, TX, is an independent refiner and marketer of high-value transportation fuels. Over the past seven days, CVI has seen an upward revision in earnings estimates for 2023.
Par Pacific, a growth-oriented company, combines knowledge of corporate financing with experience in the oil and gas sector. With 94,000 bpd of active refining capacity and a logistical system that includes an SPM, storage, barges, pipelines and trucking operations, PARR owns and manages one of Hawaii's biggest energy networks. Over the past 30 days, PARR has witnessed upward earnings estimate revisions for 2023 and 2024.
Murphy USA operates stations close to Walmart supercenters and sells low-cost, high-volume fuel. This helps the company get a lot more business than its competitors. Another significant competitive advantage for the firm is its access to product distribution centers and pipelines, which helps control costs in the intensely competitive retail sector. Over the past 30 days, MUSA has witnessed upward earnings estimate revisions for 2024.
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