Shell (SHEL) Looks to Sell a Stake in Sprng Energy Assets
Shell SHEL, the British energy giant, is exploring options to sell a stake in the operational assets of Sprng Energy, a renewable energy platform it acquired in 2022 for $1.55 billion. The move is part of Shell's efforts to recycle capital and accelerate the growth of its renewable portfolio in India, a key market for the company.
Shell is reportedly looking to sell a minority stake in Sprng Energy, which has a portfolio of 2.1 gigawatts (GW)-peak of operating solar and wind assets in India, with a further 7.5 GW of projects in the pipeline. The company said that it is open to partnering with investors who want to deploy capital on de-risked operational assets.
The sale of a stake in Sprng Energy would be a significant shift in strategy for Shell, which has been investing heavily in renewable energy in recent years. However, the company is now under pressure to boost its cash flow and reduce debt levels, and the sale of Sprng Energy could help achieve this.
The decision is also likely to be influenced by the current energy crisis. The war in Ukraine has caused energy prices to soar, which boosted the oil and gas companies’ profit. Shell is now seen as being more focused on its core fossil fuel business, and the sale of Sprng Energy could be seen as a way to free up resources to invest in oil and gas.
The sale is likely to attract a lot of interest from potential investors. The Indian renewable energy market is one of the fastest growing in the world, and Sprng Energy is a well-established player in the same. The deal could also be seen as a test to assess renewable energy investments in the current economic climate.
Only time will tell what Shell's ultimate plans are for Sprng Energy. However, the sale is a significant development for the Indian renewable energy sector, and will be closely watched by investors and industry experts alike.
Murphy Oil Corporation MUR announced that its subsidiary closed the previously announced divestment of certain non-core operated Kaybob Duvernay assets and all of its non-operated Placid Montney assets in Canada. Murphy Oil received cash proceeds of nearly $104 million (C$141 million).
The company is a strong cash flow generator, which will enable it to continue returning value to its shareholders.
TC Energy TRP sold a 40% stake in two of its natural gas pipelines to GIP for C$5.2 billion. This is part of TRP's plan to raise capital and reduce debt.
The sale is expected to close in the fourth quarter of 2023, and the proceeds from the same will be used to fund other projects, including the Coastal GasLink pipeline.
Eni SpA E signed a deal to sell its participation stake in several oil assets in the Republic of the Congo for $300 million. The contract is part of Eni's strategy to divest non-core assets and focus on its natural gas business.
The sale is expected to generate 1 billion euros ($1.1 billion) in net cash for Eni, which will be used to fund its remaining asset sales and acquisitions during 2023-2026.
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