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ACCC Concerned about Shell's Proposed Takeover of BG Group
Mining Weekly reported that The Australian Competition and Consumer Commission (ACCC) is concerned about the proposed acquisition of BG Group (LSE:BG) by Royal Dutch Shell (NYSE:RDS.A,LSE:RDSA).
Mining Weekly reported that The Australian Competition and Consumer Commission (ACCC) is concerned about the proposed acquisition of BG Group (LSE:BG) by Royal Dutch Shell (NYSE:RDS.A,LSE:RDSA).
As quoted in the market news:
Earlier this year, Shell launched a $70-billion takeover for liquefied natural gas (LNG) producer BG. The companies’ combined deep-water and integrated gas businesses could potentially each generate between $15-billion and $20-billion in yearly cash flow, while upstream and downstream engines could potentially further generate a combined $15-billion to $20-billion in yearly cash flow.
Shell currently has a 50% interest in Queensland coal-seam gas producer Arrow Energy, whose gas reserves constitute the largest uncontracted gas reserves in eastern Australia, and that were not aligned with an LNG project.
The ACCC said in a statement this week that it was concerned that by aligning Shell’s interest in Arrow Energy with BG’s LNG facilities in Queensland, the proposed acquisition could change Shell’s incentives in such a way that it would prioritise supply to BG’s LNG facilities over competing gas users.
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