Shell Secures Major LNG Supply Boost With Pavilion Energy Deal
Date
6/18/2024 3:08:58 AM
(MENAFN- Trend News Agency)
BAKU, Azerbaijan, June 18. Shell Eastern
Trading Pte. Ltd., a subsidiary of Shell plc, has announced an
agreement with Carne Investments Pte. Ltd., an indirect
wholly-owned subsidiary of Temasek, to acquire 100 percent of the
shares in Pavilion energy Pte. Ltd, Trend reports.
This Acquisition includes Pavilion Energy's global LNG trading
business, with a contracted supply volume of approximately 6.5
million tonnes per annum (mtpa).
Pavilion Energy, headquartered in Singapore, operates a
comprehensive global energy business encompassing LNG trading,
shipping, and natural gas supply and marketing activities in Asia
and Europe.
“The acquisition of Pavilion Energy will bolster Shell's
leadership in LNG, adding significant volumes and increased
flexibility to our global portfolio,” stated Zoë Yujnovich, Shell's
Integrated Gas and Upstream Director.“We will acquire Pavilion's
portfolio of LNG offtake and supply contracts, gaining additional
access to strategic gas markets in Asia and Europe. Integrating
these assets into Shell's global LNG portfolio positions us to
deliver substantial value from this transaction while enhancing
energy security for our customers.”
The acquisition aligns with Shell's cash capital expenditure
guidance, which remains unchanged. The deal surpasses the internal
rate of return (IRR) hurdle rate for Shell's Integrated Gas
business, supporting its 15-25 percent growth ambition for
purchased volumes relative to 2022, as outlined during the 2023
Capital Markets Day.
The integration of Pavilion Energy's portfolio with Shell's will
commence post-completion of the deal, expected by 1Q2025, subject
to regulatory approvals and other conditions precedent.
Meanwhile, Shell aims to expand its LNG business by 20-30
percent by 2030 compared to 2022 levels. Additionally, the company
plans to increase purchased LNG volumes by 15-25 percent relative
to 2022, as detailed during the 2023 Capital Markets Day. This
transaction is anticipated to significantly contribute to achieving
these growth targets.
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