UK-headquartered energy giant Shell has reached an agreement with Hungarian multinational oil & gas company MOL Group for the sale of its 100%-owned subsidiary BG Cyprus Limited for up to $720 million.
BG Cyprus holds a 35% non-operated interest in the Cyprus Offshore Block 12, containing the Aphrodite gas field located approximately 170 kilometers southeast offshore, in the eastern Mediterranean.
Discovered in 2011 and appraised through subsequent drilling campaigns, it is estimated to hold around 104 bcm (632 MMBoe) of contingent gas and 8 MMbbl condensate resources. The produced gas is expected to be sold to the Egyptian Natural Gas Holding Company (EGAS).
BG Cyprus’ partners in the Aphrodite joint venture include Chevron Cyprus as the operator with a 35% interest and NewMed Energy with a 30% non-operating interest. Upon completion of the transaction, MOL will assume Shell’s rights and obligations associated with the interest.
To remind, BG Group acquired the Aphrodite interest in 2015 through BG Cyprus, which then became a Shell subsidiary following the UK major’s acquisition of BG Group in February 2016.
According to Shell, Egypt remains an important country for the company, with a significant presence remaining.
“We believe Aphrodite remains an attractive development opportunity and will play an important role in supporting regional energy needs,” said Cederic Cremers, Shell’s Integrated Gas President. “Our decision to exit is driven by disciplined capital allocation and portfolio choices, as we focus on opportunities that strengthen our integrated LNG value chain.”
The development plan of the Aphrodite field includes the drilling of four wells and the establishment of an independent floating production facility. The final investment decision (FID) is planned in 2027, with first gas expected in 2031. The project also includes the construction of a 250-kilometer subsea pipeline linked to Egypt’s gas transmission network.
The transaction is expected to complete in early 2027, subject to regulatory approval and closing conditions.
“This step is also in line with our E&P strategy that focuses on strengthening our international portfolio while building strategic partnerships with highly reputable international companies. Our entry into Cyprus and our expansion within the EU represent important milestones for us as this large-scale, long-life offshore gas development asset supports our long-term production targets and will enable us to achieve significant growth in our reserve base,” said MOL Group Chairman and CEO Zsolt Hernádi.
“This project represents the most promising growth opportunity for MOL Group’s E&P business since acquiring a stake in the giant ACG field in Azerbaijan in 2019, and I am confident it will play a key role in shaping our future business lines.”
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