Shell PLC (LSE:SHEL, NYSE:SHEL) has struck a deal with agreed to buy liquefied natural gas trading firm Pavilion Energy from Singapore's state-owned investment company Temasek for an undisclosed sum, thought to be in the hundreds of millions of dollars.
Pavilion carries out LNG trading, shipping, natural gas supply and marketing activities in Asia and Europe.
Its pipeline gas business will not be included as part of the deal, nor its 20% shareholding in deepwater gas blocks 1 and 4 in Tanzania.
"The acquisition of Pavilion Energy will strengthen Shell’s leadership position in LNG, bringing material volumes and additional flexibility into our global portfolio," said Zoë Yujnovich, Shell’s integrated gas and upstream director.
She said acquiring Pavilion’s portfolio of LNG offtake and supply contracts will provide "access to strategic gas markets in Asia and Europe".
The company said the cost of the acquisition, which is expected to complete by early 2025, does not change its cash capital expenditure guidance for the year.
Pavilion’s portfolio comprises roughly 6.5 million tons per annum (mtpa) of its long-term sale and supply LNG contracts, plus a long-term regasification capacity of approximately 2 mtpa at the UK's Isle Grain LNG terminal, and regasification access in Singapore and Spain.
It owns five tankers, three electronically controlled 'M-type' and two tri-fuel diesel electric vessels, plus an LNG bunkering business that deployed its first vessel earlier this year.