MOSCOW, Sep 2 — PRIME. ExxonMobil Corp and Shell Plc on Thursday confirmed the sale of their Aera oil joint venture to German asset management company IKAV for $4 billion. Thus, they complete their 25-year partnership, which has been one of the largest oil producing enterprises in the country.
The sale indicates that companies are moving away from mature oil and gas assets just as high oil and gas prices are favoring new deals. Reuters reported this week that the oil giants are in the final stages of negotiations to sell an asset in the San Joaquin Valley.
As a result of the deal, the company with investments in conventional and renewable energy sources will assume responsibility for the existing remnants of the first oil and gas projects in California. IKAV manages €2.5 billion in assets and owns wind, solar, geothermal and oil and gas operations. It manages the Colorado natural gas business it acquired from BP two years ago.
The deal, which is still subject to regulatory approvals, is expected to close in Q4 2022. Shell said it would write off $300 million to $400 million in assets as a result of the sale.
Exxon, which owns a 48% stake in Aera, has recently been selling its assets as it intends to focus on offshore and LNG projects in Guyana and Brazil. The deal will bring it closer to its goal of selling $15 billion in assets.
The sale of Aera is in line with a strategy to invest “in low-cost oil and gas operations to meet consumer demand and create value for shareholders,” Liam Mallon, president of exploration and production company Exxon, said in a statement.
Zoe Juinovic, director of peer group at Shell, said the sale is in line with a strategy to focus “on positions with high growth potential and a strong integrated value chain.”
Both oil firms decided to keep their other California operations, including gas station networks.