BANGKOK/SINGAPORE: Royal Dutch Shell said on Wednesday that it will sell its stake in the Bongkot gas field and adjoining acreage offshore Thailand to PTT Exploration & Production Plc for $750 million (23.5 billion baht) before tax.
The transaction is expected to be completed in the second quarter, both companies said.
"This sale takes Shell a step closer to its divestment target of $30 billion" of non-core assets, Shell said in a statement.
The deal with Thailand's PTTEP comes after Shell in October cancelled a $900 million agreement to sell the same gas field stakes to Kuwait Foreign Petroleum Exploration Company (KUFPEC).
"The two deal values are not comparable and we will not comment further on any commercial terms," a Shell spokeswoman said in an e-mail when asked about the discrepancy between the value of the two deals.
The sales agreement covers Shell's 22.2% stake in Blocks 15, 16 and 17 and Block G12/48, the companies said.
PTTEP's stake will increase to 66.7% after the purchase, with the remaining 33.3% held by France's Total, they said.
PTTEP is the upstream arm of oil giant PTT Plc and currently operates the Bongkot field which produces about 860 million cubic feet per day of natural gas and 26,000 barrels per day of condensate.
The acquisition is in line with PTTEP's strategy of adding producing assets or those which are in the final stage of development, located in Southeast Asia where PTTEP has experience, its CEO Somporn Vongvuthipornchai said in a statement.
The deal will increase PTTEP's sales volume by about 35,000 barrels of oil equivalent per day.
PTTEP is keen to continue as the field's operator after the Bongkot concession expires in 2022-2023 to maintain Thailand's energy security, Somporn said.
Chevron Corp operates the nearby Erawan field and PTTEP operates the Bongkot field under licences set to expire in 2022 and 2023 respectively.
The fields have a combined output of 2.2 billion cubic feet a day, making up about 76% of the Gulf of Thailand's output.