Royal Dutch Shell has closed a mega-takeover of British BG Group for a total consideration of US$53 billion.
The deal is expected to accelerate Shell's growth strategy in global LNG and deep water. It will add 25% to Shell’s proved oil and gas reserves and 20% to production. According to shell the combination has potential to generate pre-tax synergies of approximately US$2.5 billion per annum.
Shell believes that, by around 2020, the combined group will have:
Shell, the largest oil company in Europe, has seen its profits decreased by 80 percent in 2015. Additionally the company's earnings have deceased to $3.8 billion from $19 billion in 2014. Van Beurden recently commented in a statement:
“We are making substantial changes in the company, reorganizing our upstream, and reducing costs and capital investment, as we refocus Shell, and respond to lower oil prices.”