Anglo-Dutch oil giant Royal Dutch Shell acquired some Texan assets from US titan Chesapeake Energy on Wednesday for a price of nearly two billion dollars.
The company said that the $1.935bn acquisition marks a further step in its strategy to build "a leading portfolio of shale assets rich in oil and natural gas liquids".
Shell has acquired 618,000 net acres of acreage in the Permian Basin in West Texas. The assets, which currently produce 26,000 barrels of oil equivalent per day, are said to have "significant" growth potential.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
"The acquisition provides both existing production and near-term growth potential from a proven resource, as well as promising opportunities for expansion," Shell said in a statement.
Chesapeake announced that it was selling off $6.9bn-worth of assets today, as it attempts to deal with an estimated $10bn funding gap. As part of this bumper sale, both Chevron and EnerVest are acquiring assets in the Permian Basin.
A "portion" of the proceeds from today's deals will be used to fully repay its $4bn of term loans during the fourth quarter this year, the US firm said.
October’s NS&I Premium Bond winners revealed - have you scooped £1 million?
Two lucky NS&I Premium Bond winners are now millionaires this October. Find out here you are one of them
By Kalpana Fitzpatrick Published
Nationwide: House prices fall across the UK at fastest pace since 2009
House prices drop 5.3% on the year as high borrowing costs hit prospective buyers.
By Pedro Gonçalves Published