Shell increases stake in Ursa platform and pipeline, deepens deepwater oil strategy in the Gulf of America

Shell plc has expanded its footprint in the Gulf of America by acquiring additional working interests in the Ursa platform and related pipeline assets, bolstering its control over one of its most strategically significant deepwater hubs. The move aligns with the company’s ongoing strategy to focus on profitable, carbon-competitive oil and gas developments located near existing infrastructure.

Through its subsidiaries Shell Offshore Inc. and Shell Pipeline Company, Shell has completed a previously announced transaction to raise its working interest in the Ursa tension-leg platform (TLP) from 45.3884% to 61.3484%. Simultaneously, Shell has increased its stake in the associated Ursa pipeline from 45.39% to 57.20%, following a preferential rights process exercised by asset partners.

The acquired interests were purchased from ConocoPhillips, which held a minority position in the Ursa development and has now exited the asset as part of a broader effort to rationalise its upstream portfolio. The acquisition includes not only equity in the production platform and pipeline, but also a 1% working interest in the Europa prospect, another Shell-operated venture in the same hydrocarbon-rich region, and a 3.5% overriding royalty interest in Ursa’s production.

Why is the Ursa platform a strategic asset for Shell?

The Ursa platform has long been a cornerstone in Shell’s Gulf of America operations. Located roughly 130 miles southeast of New Orleans, in the prolific Mars Basin, Ursa is a deepwater tension-leg platform that commenced production in 1999. The platform was developed through a joint venture between Shell, BP Exploration & Production Inc., ConocoPhillips, and ECP GOM III, LLC. With the completion of this deal, Shell becomes the majority stakeholder and retains operatorship of the platform.

Historically, the Ursa field has produced over 800 million barrels of oil equivalent (boe), contributing significantly to Shell’s U.S. deepwater output. The region is well-known for its thick hydrocarbon reservoirs and established infrastructure, making it a cost-efficient environment for ongoing production and future development. The asset’s long production history and tie-back potential have made it a stable source of cash flow, especially during periods of oil price volatility.

Shell’s strategic focus on the Gulf of America is evident from a series of acquisitions and infrastructure developments over the past decade. With growing pressure on energy companies to balance profitability with sustainability, Ursa fits Shell’s criteria as a “carbon-competitive” asset—offering high returns with lower relative emissions intensity due to proximity to existing facilities.

How does the acquisition support Shell’s upstream investment strategy?

The acquisition reinforces Shell’s stated upstream strategy of concentrating on “advantaged” assets—projects with low breakeven costs, integration opportunities, and strong potential for emissions optimisation. By acquiring a greater share in the Ursa platform, Shell consolidates control over a producing asset that not only offers stable output but also serves as a hub for regional development.

From a portfolio perspective, the deal also enhances Shell’s ability to optimise logistics, reduce operating expenditures, and streamline maintenance and inspection activities. These advantages are critical as the company seeks to maintain long-term production without escalating capital expenditure, especially in an environment shaped by energy transition pressures and growing shareholder scrutiny.

Shell has publicly reiterated its commitment to net-zero emissions by 2050. While upstream oil and gas will remain part of its business in the foreseeable future, Shell is prioritising assets that offer lower lifecycle emissions and can be tied into carbon management strategies, such as offshore electrification and carbon capture initiatives.

What does this mean for ConocoPhillips and broader industry dynamics?

ConocoPhillips’ divestment from the Ursa platform is consistent with its broader portfolio high-grading approach. The company has been steadily shedding non-core assets to sharpen focus on high-margin, lower-cost production zones such as the Permian Basin, Canadian oil sands, and liquefied natural gas operations in Asia-Pacific.

The $735 million transaction, though not officially confirmed in public disclosures, aligns with ConocoPhillips’ stated target of raising $2 billion in proceeds through asset sales during the current fiscal year. Market analysts have interpreted the divestiture as a sign of increased capital discipline, particularly in a commodity cycle where consolidation and operational efficiency are paramount.

This shift is reflective of a broader trend in the oil and gas sector, where firms are reassessing legacy assets in light of the dual challenges of declining resource intensity and rising environmental, social, and governance (ESG) expectations. Shell’s willingness to double down on Gulf of America infrastructure, however, signals a different thesis—one that prioritises value extraction from proven reserves through optimisation rather than greenfield exploration.

What is the sentiment around Shell’s Gulf of America strategy among investors?

The market has responded positively to Shell’s incremental acquisition. As of the latest trading session, Shell plc shares were priced at approximately $65.16, reflecting cautious optimism among investors who see the deal as value-accretive. The company’s decision to acquire producing assets rather than new developments is seen as prudent in a time when exploration risk and regulatory delays can threaten returns.

Institutional analysts have highlighted that increased control over the Ursa platform allows Shell to further integrate its upstream and midstream operations in the region. With access to both production and pipeline infrastructure, Shell can ensure enhanced operational coordination and cost visibility—factors that directly impact cash flow and earnings.

The Gulf of America remains one of the most prolific oil-producing regions globally, and Shell’s continued investment in its infrastructure suggests confidence in the region’s long-term viability, despite the broader pivot towards renewables. This approach has positioned Shell as a bellwether for oil majors seeking to balance legacy energy investments with low-carbon commitments.

How does the deal affect Shell’s long-term energy transition goals?

While the acquisition centres on hydrocarbon assets, Shell has continued to emphasise that its short- and medium-term investment decisions will support funding the transition to low-carbon energy systems. By optimising cash-generating assets like Ursa, Shell can finance renewable energy projects, invest in electric mobility, and develop emerging technologies like hydrogen and carbon capture and storage.

This dual-track strategy—monetising existing oil and gas resources while investing in the energy transition—is a common approach among integrated energy majors. Shell’s increased stake in the Ursa platform and pipeline should be viewed through this lens: a step to solidify near-term earnings while enabling long-term strategic flexibility.