• Spain's news in English

Repsol slashes debt via Shell gas deal

AFP · 2 Jan 2014, 09:27

Published: 02 Jan 2014 09:27 GMT+01:00

Facebook Twitter Google+ reddit

Repsol handed over its LNG assets in Peru and Trinidad and Tobago to Shell, the world's biggest LNG supplier, as part of a huge debt-reduction plan.

The Spanish group has been fighting to regain its financial footing, and avoid a credit rating downgrade to junk-bond status, since Argentina's shock 2012 seizure of its profitable YPF subsidiary.

The sale of Repsol's LNG assets to Shell followed a smaller $200 million sale of a Basque power plant to BP in October, bringing in a combined $4.3 billion to the Spanish group.

The sale generated a net $2.9 billion in profits and capital gains for Repsol, the Spanish group said, more than had been anticipated when the deal was first announced in February 2013.

As a result, Repsol cuts its net debt by $3.3 billion, "and significantly strengthens its balance sheet", it said.

Repsol boasted that it had already beaten its own target of shedding up to €4.5 billion in assets from 2012–2016, a plan launched following the loss of its YPF subsidiary in Argentina.

In November, Repsol's board backed a proposed compensation deal with Argentina over the seizure of YPF.

A source close to the matter said the YPF compensation offer amounted to $5 billion in Argentine government bonds.

Argentina's President Cristina Kirchner ordered the the nationalization of Repsol's 51-percent stake in YPF in April 2012, blaming Repsol's failure to make agreed investments in the firm.

The decision soured relations between Argentina and Spain and sparked an international chorus of outrage including from Spain's European Union partners.

Story continues below…

After the YPF grab, Repsol filed a complaint against Argentina with a World Bank arbitration panel, seeking $10.5 billion, and sued in a New York court seeking an undetermined amount of damages.

Settlement of the legal tangle could help to lure investment into the vast Vaca Muerta shale oil and gas field in Argentina, discovered by YPF in 2010, which is the equivalent of 22.8 billion barrels of oil.

Foreign investors have been hesitant, showing concern about Argentina's interventionist economic policies since its 2002 sovereign debt default and a threat by Repsol to sue future partners of YPF.

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
Spain's 'Napflix' aims to bore viewers to sleep
Photo: Screengrab/ Napflix

A Spanish video platform called Napflix, designed to put people to sleep with dull content, was launched this week and its founders are on the lookout for more "monotony and repetition."

Recipe: How to make fabada - traditional Asturian bean stew
Photo: Flavio Lorenzo Sánchez/Flickr

The hearty Asturian dish is a perfect lunch on a cold day... and don't forget the crusty bread and cider!

Brit 'paedo' held on Costa del Sol after Most Wanted appeal

One of Britain's most wanted fugitives was arrested on the Costa Del Sol following a tip-off from an expat just hours after his face appeared on a public appeal.

Spain's parliament approves deficit reduction measures
Photo: Images Money/Flickr

Spanish lawmakers approved on Thursday measures to reduce the public deficit and keep it under the target agreed with the European Union.

'Cubism and War' show opens at Barcelona Picasso Museum
Pablo Picasso Harlequin and Woman with a Necklace. Photo: MP

Barcelona's Picasso Museum unveiled an exhibition on "Cubism and War" on Thursday depicting how one of the most influential artistic styles of the 20th century survived the First World War.

Why this bionic limb pioneer doesn't believe in disability
Hugh Herr has been award Spain's top science prize. Photo: FPA

The Local speaks to Hugh Herr on winning Spain's top science prize and how being an amputee doesn't make him disabled.

Dine in the buff at Spain's first nudist restaurant
A buffet of organic food will be served on "human tables". Photo: Innato / Facebook

Spain's first naked dining experience is to arrive on the island of Tenerife following the success of a similar venture in London.

Spain's top court overturns bullfighting ban in Catalonia
Photo: AFP

Spain's Constitutional Court on Thursday cancelled a bullfighting ban in Catalonia in what is likely to exacerbate tensions between Madrid and the separatist region, and between animal activists and fans of the tradition.

Out of the dark: Five years on from Eta ceasefire
Eta members made a ceasefire declaration in January, 2011. Photo: Gara / AFP

Five years after armed separatist group Eta declared a permanent ceasefire, Basque journalist Alberto Letona is still wondering when the dialogue will begin.

Hunt for ten most wanted Brit fugitives hiding out in Spain
Call Crimestoppers if you recognize these faces.

These fugitives from British justice are thought to be hiding out in Spain. Do you recognize anyone?

Sponsored Article
How to vote absentee from abroad in the US elections
Madrid parish church faces fine over 'too noisy' bells
Sponsored Article
Last chance to vote absentee in the US elections
Celebrate expat life at Madrid’s THRIVE convention
Fury after kids told to bring their own loo roll to school
Sponsored Article
How to vote absentee from abroad in the US elections
Disney announces plans for Don Quixote action movie
Activist tells 8-yr-old matador wannabe with cancer 'just die'
King to make last minute push to avoid third vote in Spain
Amazing photos of Catalonia's 'human tower' contest
What's on in Spain: October 2016
'No way, Jose! You'll never get your hands on our Rock'
Recipe: How to make a classic Spanish tortilla de patatas
Chorizo in paella? Go back to cooking school Jamie Oliver
Spain in eye of a perfect storm after 10 months without govt
Thousands share clips of life for 'Spain in a Day' film
Ten incredible Spain locations for Game of Thrones season 7
Analysis & Opinion
Why moving to Spain could be the best decision of your life
Seven reasons why autumn is the very best season in Spain
Spanish study finds four types of personality. Which are you?
New search underway for civil war grave of poet Lorca
Bison found decapitated on Valencia nature reserve
Forgotten Voices: What Brits in Spain think about Brexit
One dead and 14 injured in blast at Spanish resort
Game of Thrones want extras 'with muscles' to film in Spain
Thousands march in Madrid to push for bullfighting ban
jobs available