Shell and BG going forward with large merger
Shell and BG Group are going forward with their planned merger after they received approval from a number of world regulators in recent weeks. The merger of the two energy companies will be the largest since Exxon and Mobil joined forces in the 1990s.
The two companies received clearance by U.S. regulators to start constructing a liquefied natural gas export facility in Lake Charles, Louisiana.
"We are pleased to receive the approval from the Federal Energy Regulatory Commission, an important milestone as we progress the Lake Charles project towards a final investment decision," BG Group Chief Executive Helge Lund said in a statement.
Lund went on to say the merger has the potential to create new opportunities for the company, such as an increase in long-term positions.
"Lake Charles LNG has the potential to create several thousand jobs during construction and if fully operational could result in approximately 250 long-term operational positions sustainable jobs for current and future generations," he said in a statement.
The two energy companies also received clearance from the Chinese Ministry of Commerce, Brazil, the European Union and Australia.
While the merger sparks excitement for some, some investors are wary of the deal because of plummeting oil prices. Investment firm Capital Group dropped around $150 million worth of shares in BG Group. To ease, shareholders' concerns, BG Group plans to have shareholders discuss and vote on the merger.
"Shell and BG shareholder meetings to approve the recommended combination are expected to be convened on Jan. 27 and 28, 2016, respectively," the companies said in a joint statement. "A further announcement will be made in due course."
Construction on the Lake Charles facility should start in 2016 with first exports planned for 2020.