Deal Insight
Shell acquires BG: an in-depth view
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Report summary
The strategic drivers for Shell are clear and compelling: the deal establishes it as the leading player globally in both deep water and LNG. Deal economics are equally attractive: we value BG at US$84 billion (NPV10), or an Implied Long-term Oil Price of US$85/bbl.
What's included
This report contains
Table of contents
- Executive summary
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Upstream assets
- Growth underpinned by Brazil deepwater and LNG
- Legacy asset base has supported investment in growth assets
- A refreshed exploration portfolio offers longer-term options
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Deal analysis
- LNG trading business valuation sensitivities
- Technical resource upside
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Strategic rationale
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Shell
- Next steps - rationalisation
- Next steps - cash flow generation
- Next steps - further acquisitions on the cards?
- BG
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Appendix 2 - BG portfolio upsides and risks to our base modelling
- Brazil
- Appendix 3 - Transaction details
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Shell
- Oil & gas pricing and assumptions
Tables and charts
This report includes 11 images and tables including:
Tables
- Deal analysis: Table 1
- Deal analysis: Table 2
- Deal analysis: Table 3
- Oil & gas pricing and assumptions: Table 1
- Oil & gas pricing and assumptions: Table 2
- Upstream assets: Table 1
- Appendix 1 - BG portfolio base modelling and valuation
Images
- 1) WoodMac base forecast for BG production; 2) WoodMac base valuation of BG upstream portfolio
- Shell / BG upstream portfolio overlap, WoodMac NPV10: 1) by country; 2) by resource theme
- Shell BG combined vs. peers based on: 1) production; 2) total resource
- 1) Share price performance (relative) and; 2) market premium / discount to WoodMac valuation
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