Shell bails out of Canadian sands arm at £6 billion

Royal Dutch Shell on Thursday offloaded most of its controversial Canadian oil sands business for $7.25 billion (£5.95 billion) as the oil major slashes debt in the wake of its mega-merger with BG.

Chief executive Ben van Beurden, who gained a 61% rise in his pay package to €8.3 million (£7.2 billion) according to the group’s annual report, is targeting $30 billion of sales by 2018.

Shell is selling all its undeveloped oil sands interests in Canada to the country’s biggest oil company, Canadian Natural Resources.

It is also slashing its share in the Athabasca oil sands project to just 10%.

The move will be cheered by environ-mentalists, who have long cam-paigned against the damaging process of extracting crude from the clay-like tar sands found in northern Alberta.

The process uses more water and energy and emits more carbon dioxide than conventional oil production.

Since the oil price sank below $100 a barrel in 2014, the process has also lost favour with production firms because it is more expensive.

The assets sold by Shell today produced 160,000 barrels a day but lost $22 million last year.

The firm will instead focus on its deepwater production and gas businesses, where it is a market leader.

The company has made $19 billion in sales under van Beurden’s plan.

The overall pay last year of van Beurden was bolstered by his vesting of long-term incentive plans worth €4.4 million.