By Hadeel Al Sayegh and Ron Bousso
DUBAI/LONDON, Feb 26 (Reuters) - Royal Dutch Shell's
onshore Egyptian oil and gas assets have drawn interest
from American, Egyptian, Asian and Middle East bidders, two
sources familiar with the matter told Reuters.
Shell launched a process at the end of November to sell its
onshore upstream assets in the Western Desert to focus on
expanding its Egyptian offshore gas exploration.
It appointed investment bank Citigroup to run the
sale, which could fetch around $1 billion, a source close to the
process told Reuters in November.
The oil major's Western Desert portfolio includes stakes in
19 oil and gas leases of which Shell's working interest included
output of around 100,000 barrels of oil equivalent per day last
year, Reuters reported at the time.
U.S. oil and gas producer Apache Corp, Egyptian
firms Apex International Energy and Cheiron, and London-listed
Pharos Energy submitted bids, said the two sources
close to the deal, declining to be named as the matter is not
public.
There were other Asian and Middle Eastern bidders too, they
said. One of the sources said all the bids were non-binding.
Shell, Citi, Apex, Apache and Pharos declined to comment
when contacted by Reuters. Cheiron did not immediately respond
to requests for comment.
The second phase will see companies short-listed for
due-diligence and binding offers, one of the sources said.
The transaction could take a long time, both sources said,
citing weaker gas prices and a lengthy process in Egypt since
such assets require government approvals.
The second source said the deal was unlikely to close before
May.
Egypt's oil and gas sector has seen a rapid expansion in
recent years after the discovery of vast offshore gas reserves
that has drawn major investments from international companies
including Eni and BP.
At the same time, Egypt's aging oil and gas assets have
changed hands. BP last year sold its decades-old stake in the
Gulf of Suez Petroleum Company (GUPCO) to Dubai-based Dragon Oil
Ltd.
(Reporting by Hadeel Al Sayegh in Dubai and Ron Bousso in
London, additional reporting by Patrick Werr in Cairo; Editing
by Emelia Sithole-Matarise)
BP (BP.)
