WARSAW: Royal Dutch Shell agreed to buy the BG Group for $70 billion. It is the first major deal for oil and gas producer since prices started falling last summer. The acquisition could provide a template in the current environment, with deep-pocketed players taking advantage of their competitors’ problems to bolster their own position.
In buying BG, Shell is concentrating on the fast-growing business of producing and selling liquefied natural gas. It will also become a major player in Brazil’s offshore oil fields, where Shell’s exposure has been small. Shell is taking advantage of the financial struggles of BG. Before the deal was announced, BG had watched its shares fall more than 30 percent since May.
