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Shell share price: Group mulls sale of Norway oilfields

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screen-shot-2016-11-09-at-20-26-36by Tsveta ZikolovaMonday, 14 Nov 2016, 10:36 GMT

Royal Dutch Shell (LON:RDSA) is considering a sale of part or all of its $3-billion Norwegian business, The Sunday Times has revealed. The disposal would come with the Anglo-Dutch oil giant looking to pay down debt amid growing investor pressure, following the acquisition of former smaller London-listed rival BG Group.

Shell’s share price has been little changed in London this morning, having inched 0.28 percent higher to 1,954.50p as of 10:08 GMT. The stock, however, is underperforming the broader market rally, with the benchmark FTSE 100 index having soared 1.15 percent to stand at 6,807.63 points. The shares have added just under a fifth over the past year, and are up by some 28 percent in the year-to-date.

The Sunday Times reported yesterday that Shell had lined up investment bank Rothschild to conduct a review of its Norwegian business. The Anglo-Dutch group operates several large fields in the Norwegian North Sea and has smaller stakes in others.

The news comes with the Anglo-Dutch oil major having pledged to sell $30-billion in assets following the group’s acquisition of BG Group. Earlier this month, the company noted in its interim statement that it was ‘actively working’ on 16 material asset sales as part of its planned $30 billion divestment programme. The oil major further said that it will be targeting spending of about $25 billion next year, at the lower end of its previously guided $25-$30 billion range, as it continues to battle the ongoing weak crude price environment.

In analyst news, Barclays reiterated its ‘overweight’ rating on Shell last week, with a price target of 2,600p on the stock. HSBC, which is also bullish on the Anglo-Dutch group with a ‘buy’ stance, meanwhile trimmed its valuation on the shares from 2,360p to 2,260p.

As of 10:38 GMT, Monday, 14 November, Royal Dutch Shell Plc ‘A’ share price is 1,943.00p.

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