Abu Dhabi's state investment arm Mubadala said on Tuesday its energy unit has bought 20 percent of Royal Dutch Shell's stake in production and exploration projects in Algeria. "Liwa Energy ... bought a 20 percent stake in the projects carried out by Shell's exploration and production in Algeria," Mubadala said in a statement, without giving the value of the deal.
Mubadala, managing over $10 billion of assets, is among investment agencies in the world's top oil-exporting region that are buying into Western firms, some hit by the subprime mortgage market crisis in the United States. Liwa is a wholly owned subsidiary of Mubadala.
Mubadala and Shell agreed in 2005 to work together on energy projects outside the United Arab Emirates in the Middle East and North Africa. Liwa has bought into two production sharing agreements that Shell holds in Algeria. They are PSAs for the Reggane Djebel Hirane and the Zerafa areas.
Shell and Algeria's state-run oil company Sonatrach have been conducting exploration and appraisal activity in the two areas, Mubadala said. After the sale, Shell affiliates owns 60 percent of the concessions for the two areas, Sonatrach owns 25 percent and Liwa owns 15 percent. The five-year contract was awarded to Shell in 2005.
Mubadala already holds investments in power stations and oil and gas projects in Algeria. Abu-Dhabi controls over 90 percent of the oil reserves in the United Arab Emirates, which is the world's fifth-largest oil exporter.
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