Shell Threatens Petroleum Dealers After Buying BG Group
This is equivalent to Ksh 6.5 trillion in the first major energy industry merger in over a decade.
This is also the third biggest oil and gas deal ever by enterprise value and will expand Shell assets in Brazil, East Africa, Australia, Kazakhstan and Egypt including some of the world's most ambitious liquefied natural gas projects.
Stitched together by Shell CEO Ben Van Beurden and BG chairman Andrew Gould, the tie-up comes after oil prices halved since last June putting a premium on access to proven assets rather than costly exploration.
Shell said on Wednesday the deal would boost its proven oil and gas reserves by 25 percent.
The merger deal is, however, not expected to affect Shell's downstream oil business across the world.
Analysts at investment bank Jefferies now say they expect Shell to surpass Exxon as the world's largest publicly traded oil and gas producer by 2018 with an output of 4.2 million barrels of oil per day.
Shell is poised to be the largest oil firm in the world.
By Wangui Ngechu
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