Breaking News
Investing Pro 0
Cyber Monday Extended SALE: Up to 60% OFF InvestingPro+ CLAIM OFFER

Exclusive: Shell plans to exit California joint venture with Exxon Mobil - sources

Commodities Jul 01, 2021 12:21AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
3/3 © Reuters. FILE PHOTO: Oil drills are pictured in the Kern River oil field in Bakersfield, California November 9, 2014. REUTERS/Jonathan Alcorn/File Photo 2/3
 
CVX
-0.80%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
RDSa
-0.11%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
XOM
-0.85%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
OXY
-0.86%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
NG
-7.66%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
BP
-1.01%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Jessica Resnick-Ault, Arathy S Nair and Shariq Khan

(Reuters) - Royal Dutch Shell (LON:RDSa) Plc plans to leave Aera, its California-based oil and gas-producing joint venture with Exxon Mobil Corp (NYSE:XOM), four people familiar with the talks told Reuters.

Shell has divested numerous carbon intensive assets this year, selling its refinery in Washington state to Holly Frontier Corp and its stake in a Houston-area refining joint venture to Petroleos Mexicanos as it shifts new investments to renewables and power.

The company is also considering a sale of its assets in the Permian Basin of Texas, Reuters previously reported.

Aera produces about 125,000 barrels of oil and 32 million cubic feet of natural gas each day, accounting for about 25% of the state's oil and gas production.

Shell has notified Exxon of its plans to exit the venture, the people said, speaking on the condition of anonymity as the talks are private. A Shell spokesperson declined to comment, citing company policy.

The joint venture, headquartered in Bakersfield, California, produces primarily in the San Joaquin Valley. Shell has previously sold all of its California oil refining operations, some of which had pipeline connections to the fields.

California still produces roughly 360,000 barrels of oil per day even as it has introduced the most stringent state-level rules on greenhouse gas emissions. Last year, an executive order required that by 2035 all new cars and passenger trucks sold in California be zero-emission vehicles, and that the state reduce the dirtiest forms of oil extraction.

Oil prices have soared this year, gaining more than 50% as demand has rebounded as COVID-19 pandemic travel restrictions are lifted. The price increase has prompted many oil producers to put assets up for sale. The rush to sell is amplified by investor pressure to reduce fossil-fuel investments to stem global climate change brought by carbon emissions.

Shell and other Europe-based oil producers such as BP (NYSE:BP) Plc and TotalEnergies have pledged to lower emissions through increased investment in renewables while divesting some oil and gas holdings.

Shell, one of the world's largest oil companies, said this year it would aim to cut the carbon intensity of its products by at least 45% by 2035, and by 100% by 2050 from 2016 levels. A Dutch court has ruled that Shell's efforts are not enough, ordering it to lower emissions by 45% by 2030 from 2019 levels.

More deal-making could take place this year, with Chevron (NYSE:CVX) looking to shed about $1 billion of assets in the Permian Basin of Texas and New Mexico. Exxon, Occidental Petroleum Corp (NYSE:OXY) and others are looking to shed unwanted assets and raise cash, according to industry experts.

Exclusive: Shell plans to exit California joint venture with Exxon Mobil - sources
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email