After selling XTO and with this Exxon sell recently announced of assets similar to Cold Lake, have to wonder how much longer Exxon will keep the tired assets at Cold Lake. A large part of the Aera operation is steam injection in the Bakerfield California area and if they sold can Cold Lake be far behind?
HOUSTON, Sept 1 (Reuters) - Exxon Mobil Corp (XOM.N) and Shell Plc (SHEL.L) on Thursday confirmed the sale of their California oil joint-venture Aera to German asset manager IKAV for $4 billion, ending a 25-year-long partnership that was one of the state's largest oil producers.
The sale reflects the two companies move out of mature energy properties at a time when high oil and gas prices favor new deals. Reuters this week reported the oil giants were in advanced talks on a sale of the San Joaquin Valley property. read more
The deal puts a company with conventional and renewable energy investments in charge of a living relic of California's early oil and gas production. IKAV has 2.5 billion euros ($2.49 billion) under management and owns wind, solar, geothermal and oil and gas operations. It operates a Colorado natural gas business acquired two years ago from BP.
The transaction is expected to close in the fourth quarter of 2022, subject to regulatory approvals. Shell faces a $300 million to $400 million impairment charge as a result of the sale, it said.
IKAV buys assets with strong cash yields and holds them to maximize returns to its funds, according to its website. Last year, it built a solar plant in Italy and took a majority stake in Metaenergia, an Italian operator of gas-fired power plants.
Exxon, which owned 48% of Aera, has been divesting operations as it focus on Guyana, Brazil offshore and liquefied natural gas projects. The deal brings its closer to a target of selling $15 billion in assets.