Hot off the press from the FT:
BG confirmed in a statement that the two were in talks, though it said there could be no certainty that Shell would ultimately make an offer. It said that in accordance with the UK Takeover Code, Shell had to announce its firm intention to make an offer for BG by May 5 — though the deadline can be extended.
BG has been hit particularly hard by the 50 per cent slide in crude, which pushed it into a full-year loss for 2014. In February it announced it was writing down the value of its asset portfolio by $8.9bn to reflect the price fall.
…Acquiring BG would give Shell a significant foothold in the Brazilian pre-salt, one of the world’s most highly-prized oil provinces, as well as a big position in unconventional gas in Australia.
That would be good news for Australia. A combined Arrow/QCLNG operation in QLD could help ease gas supply concerns for the east coast white elephants LNG projects.
I thought shell might play for Santos but I was obviously thinking far too small.
STO and/or ORG have to be in cross-hairs now as well, though not until they get on with their bloody writedowns.
