Royal Dutch Shell (LON:RDSa) is trading up 1.85% at 19.71
Up until a few days ago, the leadership of British North Sea producer Siccar Point was negotiating the sale of a stake in the promising Cambo oil development to another private equity-backed company, NEO, sources told Reuters.
But on Thursday Royal Dutch Shell (LON:RDSa), Siccar Point’s partner in the project, pulled its support for Cambo amid a wider public debate about the future of fossil fuels development in the North Sea. The deal with NEO, as well as the future of the 1.9-billion-pound ($2.51 billion) project, were thrown into disarray, according to three industry sources.
Shell’s decision sends a negative signal to other companies, investors and bankers who are thinking about putting money into the ageing basin, including by buying assets from majors, industry sources told Reuters.
The withdrawal from Cambo came several weeks after a British regulator rejected Shell’s plans to develop another North Sea gas field, Jackdaw, whose future also remains in doubt unless Shell comes up with a revised plan that passes muster.
In its announcement on Thursday, Shell said Cambo was not economically viable. But company sources said the decision was also influenced by climate protests against developing new oil and gas resources in the North Sea, as well as public opposition to Cambo by Scotland’s First Minister Nicola Sturgeon.
“It’s an economic decision but that’s not to say that the external environment doesn’t impact the decision. It’s about business risk,” one Shell source said.
On technical fronts Royal Dutch Shell (LON:RDSa) RSI stood at 57.54 and currently stock is trading above all MA. So, BUY position can be taken with following target and stoploss:
TRADE SIGNAL – : Royal Dutch Shell (LON:RDSa) – BUY: 19.76, TARGET: 19.96, STOP LOSS : 19.55