World Bulletin / News Desk
Canadian Natural Resources Limited announced Thursday it has entered into an agreement to buy Royal Dutch Shell’s assets and half of Marathon Oil’s stake in the Alberta oil sands for (C)$12.74 billion.
The blockbuster deal, which is subject to approval, includes (US)$7.9 billion cash and 98 million Canadian Natural shares going to Shell, as well as $2.5 billion for the Marathon purchase.
It will see about 3,100 employees from Shell and Marathon Oil move under the Canadian Natural banner.
Shell has been pursuing a path to cut its debt by US$30 billion and the sale to Canadian Natural puts the Anglo-Dutch company about two-thirds of the way to that goal, reported the Financial Post newspaper.
“This announcement is a significant step in re-shaping Shell’s portfolio,” the company’s Chief Executive Officer Ben Van Beurden said in a statement. “The proceeds will accelerate free cash flow…and make a meaningful contribution to Shell’s US$30 billion divestment program.”
The Alberta oil sands are the third largest proven oil reserves in the world, CTV television news reported.
Corey Bieber, Canadian Natural’s chief financial officer, lauded the deal.
“It is a rare opportunity to be able to acquire [an] asset like [this],” he said.
The oil sands are “migrating to fewer players who can drive efficiencies through economies of scale”, Canadian Natural president Steve Laut said in a conference call with analysts, CTV reported.