Royal Dutch Shell has announced it is buying British gas producer BG group for $70 billion, giving Shell a bigger share of the natural gas market as oil prices fall.
The companies put out a joint statement Wednesday urging shareholders on both sides approve the deal. Shell says the takeover will add 25 percent to its oil and gas reserves and increase production by 20 percent over 2014.
Shell says the two companies together will produce financial gains of about $2.5 billion a year.
"The addition of BG's competitive natural gas positions makes strategic sense, ahead of the long-term growth in demand we see for this cleaner-burning fuel,'' Shell CEO Ben van Beurden said.
BG's chief executive Helge Lund said in the statement that the two companies' assets complement each other, pairing BG's strengths in exploration, processing, and marketing with Shell's development expertise and financial heft.
"BG's deep water positions and strengths in exploration, liquefaction, and LNG shipping and marketing will combine well with Shell's scale, development expertise and financial strength,'' he said.
The pairing of the two companies is also expected to shore up vulnerabilities exposed by the volatile oil market.
Some information for this report was provided by AP, AFP and Reuters