Royal Dutch Shell raises offer for Cove Energy to US$1.8 billion

25 April 2012

The Royal Dutch Shell group has raised its offer to buy 100 percent of Irish company Cove Energy to US$1.8 billion (GBP1.12 billion), the Irish company said in a statement issued Tuesday.

Following this new offer the group has matched the offer put forward by Thai group PTT Exploration & Production Pcl (PTTEP), which had out bid Royal Dutch Shell’s first offer made public when Cove Energy announced it was for sale.

Cove Energy put itself up for sale last January after announcing one of the world’s biggest natural gas discoveries in the last few years in the sea off Mozambique and in which it has an 8.5 percent stake in the Rovuma Area 1 block. The block has estimated reserves of 30 trillion cubic feet of natural gas, which will supply processing units and later be exported to Asian markets.

The company’s chief executive, Michael Blaha, said in a statement that the offer from Shell was “excellent” and added that the Anglo-Dutch group had extensive experience in development and execution of projects as well as sale of natural gas.

In an additional statement, Cove Energy announced that PTTEP was considering the new offer by Royal Dutch Shell and would make an announcement, “when and if appropriate.”

The Mozambican government has already announced that it will levy a tax of 12.8 percent on the profits from the sale of Cove. (macauhub)