A merger between Royal Dutch Shell and BG Group has resulted in the decision by Shell to sell off assets in Mexico worth US$425 million. The deal between Netherland’s Shell and the British BG is worth $50 billion and forced Shell to increase its borrowing in order to maintain its dividend policy at a time of low oil prices. The sale of properties in the Gulf of Mexico to Houston-based independent energy company, EnVen Energy Corp, is expected to close in October 2016. Shell will divest 100% of its Brutus/Glider assets that have a combined current production of about 25,000 bpd, which is equivalent to 5.8% of Shell’s Mexican oil production. The purpose of the divestment is to generate proceeds to pay for the BG Group merger and to improve its profitability amid depressing oil prices.
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