Energy company Shell has announced plans to sell its stake in the Browse project to UK’s BP for an undisclosed sum.

Shell owns a 27% stake in the project, which has been on the drawing board for years now.

In an announcement, Shell Australia said: “Shell Australia has signed an agreement with BP for the sale of Shell’s interests in the Browse Project subject to regulatory approvals.

“Browse remains an important Australian resource which if developed will provide much-needed energy to customers as the energy market transitions towards lower carbon energy.

“Shell regularly assesses its portfolio to inform capital allocation and maximise returns and performance however, the Browse asset is no longer a strategic fit in the context of Shell’s global portfolio.”

The Browse project, which is estimated to cost $20.5bn, is believed to be one of Australia’s largest untapped conventional gas resources.

According to Reuters’ report, the project could replace the old gas fields to supply the North West Shelf LNG (liquefied natural gas) plant.

The development of Browse would significantly increase the North West Shelf LNG plant’s lifespan and assist Australia’s leading trade partners, notably China, Japan, and South Korea, to meet their LNG demands.

If the deal materialises, BP’s holding in Browse would rise to 44%, surpassing that of operator Woodside Energy Group, which currently holds a 30.3% stake.

Woodside, BP, and Shell also own a stake in the North West Shelf LNG plant.

“BP believes development of the Browse gas resources could make a significant contribution to energy security in Australia and to the Asia Pacific region,” a BP spokesperson was quoted by the news agency as saying.