Shell Shares Ticks Higher: North Sea Asset Deal with Exxon Mobil Scrapped

Shell's share price (LON:SHEL) experienced a modest upswing this morning, trading 0.61% higher at 2,738.5p. after the energy giant and its partner Exxon Mobil announced the cancellation of a planned sale of natural gas assets in the UK's Southern North Sea. The decision, attributed to evolving market conditions, has prompted positive, yet measured, reaction in the markets.

The halted transaction involved the sale of a portfolio including 11 offshore fields and the onshore Bacton Gas Processing Terminal to Viaro Energy, a deal initially agreed upon in July 2024.

These assets collectively produced approximately 28,000 barrels of oil equivalent per day in 2023, representing about 5% of the UK's total gas production. The reversal comes despite Viaro Energy securing full funding for the acquisition, indicating that factors beyond mere financial capacity were at play. The parties agreed that conditions necessary to complete the deal were not met.

The decision to retain these assets offers Shell continued revenue streams from these productive fields. Maintaining control over a significant portion of the UK's gas production could provide stability, especially given the current volatility prevalent in the energy markets. This move contrasts with the company's earlier financial reports, such as the 16% decline in annual profit for 2024, which was largely attributed to weaker oil and gas prices and reduced demand.

Despite the profit dip, Shell has demonstrated a commitment to shareholder returns, exemplified by its consistent share buyback programs. In January 2025, the company increased its dividend by 4% and announced a $3.5 billion share buyback program for the current quarter, marking the 13th consecutive quarter of at least $3 billion in share repurchases.

Subsequently, in May 2025, another $3.5 billion share buyback was launched after the firm posted adjusted earnings of $5.58 billion for the first quarter, exceeding analyst expectations. Such actions signal financial strength and a shareholder-friendly approach, potentially boosting investor confidence and lending support to the stock price.

The combination of retained assets, proactive shareholder return initiatives, and favourable analyst assessments appears to have contributed to the recent uptick in Shell's share price.