SHELL WILL SELL $20 BLN
Royal Dutch Shell announced organizational changes in its business as it prepares for its biggest ever takeover amid what it expects to be a prolonged downturn in oil prices.
Europe's biggest oil company will run its natural gas business as a "stand-alone organization" led by Maarten Wetselaar, who will become integrated gas director and a member of the executive committee, Shell said in a statement on Tuesday.
Marvin Odum, currently director of the company's upstream unit in the Americas, will lead a new unconventional resources unit, including heavy oil and shale activities in the Americas.
Shell also raised its estimate of savings from synergies for the acquisition of BG Group by $1 billion to $3.5 billion. The company is targeting $11 billion of total cost savings this year, including a 10% reduction in operating costs and 20% lower capital spending, according to the statement.
It plans to sell $20 billion of asset in the two years to the end of 2015 and reiterated a plan to dispose off $30 billion from 2016 to 2018, following the acquisition of BG Group.
The net asset value Brent crude price break even for the BG deal is currently estimated to be in the mid-$60s, the company said.