ACCC Concerned about Shell's Proposed Takeover of BG Group

Oil and Gas Investing

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.

Click here to read the full Mining Weekly report.

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