Shell: U.K. Upstream Merger Is A Good Sign For Shell And A Bad One For The U.K.
Summary
- Shell and Equinor will merge their UK upstream assets into a 50/50 joint venture, creating the largest producer in the UK North Sea.
- The deal is the latest in the line of divestments by global majors which since 2017 have sold >$10B of UK assets.
- With the UK operating environment becoming increasingly challenging, we view the deal as a key step for management to deliver on a more streamlined, higher value Shell.
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