Shell, PetroChina to Buy Australia's Arrow

Royal Dutch Shell and PetroChina announce that Arrow Energy's board unanimously recommends its shareholders vote in favor of their joint proposal to acquire all of Arrow's shares.

By Andrea Tse , Mar 22, 2010 8:28 AM EDT

NEW YORK (

TheStreet

) -- A

Royal Dutch Shell

(RDS.A)

subsidiary and a

PetroChina

(PTR) - Get Report

unit said the board of Australia's

Arrow Energy

unanimously recommended its shareholders vote in favor of their joint proposal to acquire all of Arrow's shares.

CS CSG, a 50/50 joint venture owned by Shell and PetroChina, agreed to pay Arrow $4.70 (Australian) in cash per share for all of Arrow's shares, which represents a total consideration of A$3.5 billion ($3.2 billion). The companies said in a statement that this would allow Arrow shareholders to "crystallize the value" of the Queensland Coal Seam Gas (CSG) assets and realize a significant premium for their shares.

Shell and PetroChina subsidiary said the deal would allow them to own Arrow's Queensland CSG assets and domestic power business, as well as Shell's Queensland CSG assets and its site for a proposed liquefied natural gas plant on Curtis Island at Gladstone in Australia.

-- Reported by Andrea Tse in New York

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