Shell Offloads $3.3 Billion Stake in Woodside

By Joel ScanlonNov 9 2010

Royal Dutch Shell has agreed to sell one third of its stake in the Australian company Woodside Petroleum for $US3.3 billion or about $A3.26 billion. Approximately 78.34 million shares would be sold by Shell to equity investors as per a company statement.

This is the largest block sale in Australian corporate history. The sale brings to an end talk and speculation of Shell trying to takeover Woodside for good. Shell had failed to gain control of the project in 2001 as the Howard government had blocked the $10 billion takeover on the grounds of national interest.

The Chief Executive of Royal Dutch Shell, Mr Peter Voser said that the sale of its stake in Woodside was part of Shell's strategy to raise $7 to 8 billion in the next two years by selling non core activities. The money raised would be focussed on investments in direct assets or joint ventures.

Mr Voser said that Shell is looking to invest in liquefied natural gas projects in Australia for years to come. Analysts feel that Shell may increase its holdings in other projects such as the Gorgon gas project in Western Australia.