$613 million sale in the pipeline

Shell has entered into an agreement with Enbridge for the sale of Shell Gas Transmission, which includes most of Shell’s Gulf of Mexico natural gas pipeline business, for $613 million.

Shell US Gas & Power has entered into an agreement with Enbridge for the sale of Shell Gas Transmission, which includes a majority of Shell’s Gulf of Mexico natural gas pipeline business, for $613 million.

The sale is said to be part of Shell’s ongoing program to grow its upstream business and focus on core downstream activities. Shell’s US Exploration & Production business will continue as a customer of Enbridge and will retain existing contracted long-term access to the pipelines.

Shell Gas Transmission owns or has an interest in 11 Gulf of Mexico natural gas pipelines in operation or under construction with a combined landed capacity of some 4.7 bcf/d.

The business has assets located across the Gulf of Mexico production areas. Shell’s exploration and production business will retain select gas gathering assets, which are viewed as integral to continued optimisation of its existing developments and production.

Subject to normal regulatory approvals and customary closing conditions, Shell and Enbridge expect to complete the transaction by the end of 2004.