The BG deal power play in China
“I will be known as the CEO who led the BG deal,” said Ben van Beurden, “after having not done the deal a few times before.”
After failed attempts to snap up the leading player in the growing liquefied natural gas (LNG) market, the oil-price crash offered Shell one final opportunity to buy the company that has shaped its reinvention.
But the $50bn (£35bn) megadeal might not have happened if China’s most acquisitive company had succeeded in challenging the supermajor for control of BG.
China was one of the last countries to give anti-trust clearance to the energy sector’s biggest deal in a decade after Chemchina emerged as a last-minute interloper with an all-cash offer to buy the group.
Although Shell won the tug of war, the energy giant’s relationship with the world’s largest energy user has grown from strength to strength.
Shell is the largest supplier of LNG to China, which is working to wean itself from coal-fired power to help reduce the country’s air pollution crisis.
Following the BG acquisition, Shell ships more than 14m tons of LNG every year to China’s state-backed energy companies.
In return, Shell sources around $1bn of petrochemical products from Chinese refineries.