Spanish energy company Repsol to sell 25% of upstream unit for $4.8B

By Alyssa McMurtry

MADRID (AA) - Spanish energy company Repsol announced Thursday that it is selling a 25% stake in its exploration and production business to EIG for $4.8 billion.

The sale will help finance the green transition of Spain’s biggest oil company.

Repsol was the first company in its industry to target net zero emissions by 2050, according to a statement.

“Our ambition is to lead the energy transition. This pioneering agreement allows us to maintain the strategic direction of the upstream unit and, at the same time, to boost the transformation of the company and its multi-energy profile,” said Repsol CEO Josu Jon Imaz.

The buyer, EIG, is a US institutional investor that has committed more than $41.5 billion to the energy sector across 38 countries.

“As the world looks to meet the twin goals of decarbonization and reliability, we believe this partnership is well positioned to help meet the growing global demand for accessible, efficient and safe energy,” said EIG Chairman and CEO Robert Blair Thomas.

The deal values Repsol’s entire upstream unit at $19 billion, exceeding analysts’ consensus valuations of the business.

Repsol says its upstream business aims to reduce its carbon intensity by 75% within the next three years, with carbon capture and storage playing a large role.

The deal also contemplates a potential IPO of the business on the US market from 2026.

Repsol produces an average of 570,000 barrels of oil equivalent per day and is sitting on 2.3 billion barrels of proven reserves, 70% of which is gas.

Repsol has made 13 significant discoveries totaling more than 900 million barrels of oil equivalent, mainly in the US and Mexico, since 2020.