Repsol on Tuesday announced a $6.7 billion deal that will see Shell purchase a package of LNG assets from the Spanish firm.
Repsol will sell Shell its interests in LNG facilities in Trinidad and Tobago, Peru and Spain as well as LNG contracts and vessel contracts.
Those interests are a 20% share of the four-train, 15 million mt/year Atlantic LNG liquefaction plant in Trinidad; a 20% stake in the 4.4 million mt/year Peru LNG plant, which came onstream in mid-2010 and is supplied by the Camisea gas field; and a 25% stake in Spain's Bahia de Bizkaia LNG import terminal in Bilbao.
Repsol said the sale of its LNG business had attracted bids from more than a dozen of the world's biggest LNG operators.
The assets are being sold for $4.4 billion in cash, while Shell will also assume $2.3 billion in financial leases and $500 million in debt.
The agreement with Shell also includes a 10-year contract for Shell to supply the Canaport LNG terminal in eastern Canada with around 100,000 mt/year of LNG over a 10-year period.
But Repsol's 75% stake in Canaport was not included in Tuesday's deal because of the impact on the project of low natural gas prices in the US, the Spanish firm said, adding that it would look at all the "available operational, financial and strategic options" for the asset.
Repsol controls 75% of the Canaport terminal in the province of New Brunswick, where it is contracted to use 100% of the plant's capacity.
Repsol said the deal would "significantly strengthen" its balance sheet and cash position, cutting its net debt by more than half to Eur2.2 billion ($2.87 billion), excluding debts related to Gas Natural Fenosa.
