Shell to sell off its stake in Corrib Gas Field for over €1 billion

Oil company Royal Dutch Shell is to sell off its shares in the Corrib Gas Field for more than €1 billion. 

The company holds a 45% share of the gas deposits off the north Mayo coast.  

In a statement this morning, it said it had reached agreement with the Canada Pension Plan Investment Board (CPPIB) to sell all of its interests for €1.08 billion.

The deal means that Shell will no longer have any involvement in the operation of the project.

Staff at the Corrib gas terminal in Co Mayo are being briefed by management about Shell's decision to sell its stake in the project.

Around 100 people are employed in Mayo and Dublin by Shell E&P in Ireland.

The company says the new operators have no plans to reduce the workforce.

The Canadian-based Vermillion exploration company will take over the running of the Corrib gas field when the deal is approved.

It is understood they will maintain offices in Mayo and Dublin.

Gas was first detected off the north west coast in the late '90s but the project to bring it ashore was mired in controversy and subject to several challenges. 

The first gas was processed at a terminal in Bellinaboy in late 2015. 

In today's statement, Shell said it is exiting the upstream business in Ireland as a result of the sale.  

The deal, which is subject to regulatory approval, is expected to be completed by the middle of next year.  

Shell's share of Corrib Gas output amounts to the equivalent of around 27,000 barrels of oil a day. 

The change in ownership will mean that CPPIB will become a new partner in the venture, which will now be operated by Vermillion, another of the companies involved in the project. 

Shell said it will retain a presence in Ireland through its aviation joint venture, Shell and Topaz Aviation Ireland Limited based near Dublin airport.

Ronan Deasy, Shell's Country Chair in Ireland, said the company is very proud to have led the development of the Corrib gas field.

"With our existing staff remaining with the asset - CPPIB as a partner; and Vermilion, as the operator - we will be well placed to successfully own and manage Corrib," Mr Deasy added.

Shell says the decision to sell its 45% stake in the Corrib gas field came about as part of a global divestment strategy.

This was initiated after the company purchased BG, formerly British Gas.

As part of that takeover it says it is simplifying its portfolio and divesting assets globally.