Shell Offshore, a subsidiary of British-Dutch oil and gas company Royal Dutch Shell, has completed the sale of 22.45% non-operated interest in the Caesar-Tonga asset in the US Gulf of Mexico to Equinor Gulf of Mexico for a cash consideration of $965m.

Equinor Gulf of Mexico is a subsidiary of Norwegian energy company Equinor.

The transaction is part of Shell Offshore’s focus on the strategic positioning of the deepwater business for growth.

The sale is also part of the company’s strategy to pursue projects that deliver value in the 2020s and beyond and contributes to the ongoing divestment programme.

Shell has a deep-water portfolio of development and exploration acreage in the US Gulf of Mexico, Brazil, Nigeria and Malaysia, and in emerging offshore basins such as Mexico, Mauritania and the Western Black Sea.

Currently, Shell is the largest leaseholder and a major offshore producer of oil and natural gas in the US Gulf of Mexico.

In April, Shell signed an agreement to sell its interest in the Caesar-Tonga asset to Delek CT Investment.

Later, Equinor exercised its right of first refusal under the joint venture operating agreement. The effective date of the transaction is 1 January 2019.

Under the asset purchase agreement signed with Shell Offshore, Delek CT Investment had agreed to acquire 22.45% interest in four oil and gas leases for exploration, development and production in the Caesar Tonga field. The agreement covers Blocks 683, 726 (S2 and E2NE4), 727 and 770 in the Green Canyon area.

The asset has eight producing wells. In 2019, they yielded daily average production of around 71,000 barrels of oil equivalent for the total gross asset and nearly 16,000 barrels oil equivalent for the buyer’s stake.

The Caesar Tonga field has expected reserves of 68.5 million barrels of oil and 55 billion cubic feet of natural gas (buyer’s stake), equal to 78 million barrels of oil equivalent.

Anadarko Petroleum is the operator of the field in which it has a 33.75% interest. After completion of the divestment, Equinor holds 46% of the remaining interest in the asset and Chevron 20.25%.

The Caesar Tonga field began commercial production of oil and gas in March 2012 and is one of the ten largest oil and gas producing fields in the Gulf of Mexico.