Shell to sell Gulf of Mexico natural gas pipeline business

Ray Tyson

Petroleum News Houston correspondent

Shell U.S. Gas & Power LLC says it wants to sell its Gulf of Mexico natural gas pipeline business unit, Shell Gas Transmission, and its interest in 17 pipelines currently in operation or under construction in the Gulf of Mexico.

The sale is being pursued as part of the Royal Dutch/Shell Group’s ongoing program of portfolio rationalization. “As part of ongoing portfolio review, it was determined that Shell’s Gulf of Mexico business objectives do not require all gas infrastructure to be owned and operated by Shell,” said Gus Noojin, chief executive officer of Shell U.S. Gas & Power.

Shell Gas Transmission’s extensive natural gas pipeline network is well positioned in all producing corridors in the Gulf of Mexico, Noojin said. The pipelines have a total capacity of almost 9 billion cubic feet per day.

However, certain unidentified Shell Gas Transmission pipelines serving Shell production facilities will not be included in the sale, Shell said.

Assets to be sold are in the western, central and eastern segments of the Gulf of Mexico production area. An information memorandum for prospective buyers will be issued in May, and the sale of the assets is expected to be completed by year-end 2004, Shell said.