French energy company Engie has sold its British shale gas interests to petrochemical producer, Ineos, for an undisclosed sum, the companies said on March 9th.
The agreement involves minority stakes in 15 licences, seven of which Ineos, which already has the largest shale gas portfolio in Britain, holds an existing interest in. That means the company will have access to more than 1.2 million acres of shale gas acreage in the UK. Three of the licences are operated by INEOS, eight by IGas Energy and four by Cuadrilla.
Engie (or GdF-Suez as it then was) entered the UK’s shale sector through the purchase of parts of Dart Energy's licenses in 2013 - having been barred from developing shale gas in France. The divestment is part of its plans to focus less on hydrocarbons and more on renewables and energy infrastructure, like gas pipelines, and services. Other divestment includes coal fired plants in Australia, Indonesia and India.
In addition, an Engie spokesperson said the decision had been made in response to an internal strategic review into commodity price declines.
Ineos', on the other hand, is keen to snap up acreage and develop domestic sources of low cost gas to fuel its petrochemical plants in Scotland and the northeast England. It currently receives natural gas liquids (NGLs) from North American shale under a long term deal.
While the UK Government says it wants to explore shale gas in the country to help offset declining North Sea oil and gas output. But so far only one UK shale gas well has been fracked, with progress delayed by regulatory hurdles and public protests.
