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Shell offloads Norwegian LNG business

INVESTMENT ROYAL Dutch Shell has shed its Norwegian The Anglo-Dutch major is also push-
small-scale LNG supply business Gasnor to ing ahead with a sweeping divestment
Madrid-headquartered player Molgas, the oil programme.
major reported on April 8, without disclosing
the deal’s value. Shell guidance
Norske Shell will transfer its entire share- Shell also warned last week it expected to incur
holding in Gasnor, along with all of its assets a $200mn loss to adjusted earnings in the first
and staff. The sale, closed on the same day as quarter from disruptions caused by an extreme
its announcement, draws a line under Shell’s 15 cold snap in Texas in February. The major also
years of involvement in the company. It became estimates that the storm led to a cut in its pro-
a partial owner in 2004 and acquired full own- duction of 10,000-20,000 barrels of oil equivalent
ership in 2012 for $74mn. per day (boepd). Gasnor,
“Gasnor has been part of Shell since 2012 and In its trading update, Shell said it expected
we are proud of what the company has achieved. refined oil product sales to tally up to 3.7-4.7mn headquartered
Gasnor has been a pioneer in downstream LNG, barrels per day for the three-month period, ver-
with a leading position in small-scale LNG sus just below 4.8mn bpd in the final quarter in the Norwegian
production and distribution in the domestic of last year. Earlier the company was targeting
gas market,” Norske Shell’s managing director, 4.5mn bpd of sales in the latest quarter. Shell is settlement of
Marianne Olsnes, commented. “Norske Shell the world’s biggest fuel distributor. Avaldsnes,
will continue to focus on key positions where The utilisation rates at Shell’s refineries came
we can leverage our differentiated capabilities to 71-75% in Q1 2021, versus an earlier projec- controls three
in line with Shell’s strategy and net-zero target.” tion of 73-81%. The company’s margins saw an
Gasnor, headquartered in the Norwegian set- improvement to around $2.6 per barrel, from small-scale LNG
tlement of Avaldsnes, controls three small-scale $1.6 in the previous three months.
LNG production plants in Norway and distrib- Shell also warned that its gas trading results production plants
utes their production via tanker trucks and sea were expected to be “significantly below aver- in Norway.
tankers. Its sale to Molgas, an LNG distributor age.” LNG production is set to total 7.8-8.4mn
owned by French investment group InfraVia, tonnes, versus 8.2mn tonnes in the previous
has been backdated to January 1, 2020. quarter and an earlier forecast of 8.0-8.6mn
The sale comes as Shell, like many of its peers, tonnes.
is looking at ways to make the transition towards Overall upstream production is slated to
lower-carbon energy. It also follows Shell’s dis- come in at 2.40-2.48mn boepd, up from 2.37mn
posal of the Nyhamna gas processing plant in boepd in the fourth quarter but at the lower end
Norway in 2019. of the forecast range.™

Week 15 16•April•2021 www. NEWSBASE .com P9