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Carlyle Group, the world's largest private-equity fund, said on Friday that it has bought Royal Dutch Shell' onshore oil assets in Gabon for $587 million. The purchase was made through Assala Energy, an oil and gas, exploration and production company owned by the U.S. private equity giant. The company was created by Carlyle to focus on energy opportunities in Sub-Saharan Africa.

The oil assets sold by Shell are said to produce approximately 60,000 barrels of oil equivalent per day (BOE), out of which 40,000 BOE go to Shell. The sale of the Gabonese assets is part of Shell’s $30 billion asset sale programme expected to be completed by 2018.

“Shell is very proud of the strong legacy we have built in Gabon over the past 55 years,” Shell’s Upstream Director, Andy Brown said. “The decision to divest was not taken lightly, but it is consistent with Shell’s strategy to concentrate our Upstream footprint where we can be most competitive. Shell will continue to pursue opportunities in Sub-Saharan Africa.”
 
Carlyle said the investment represents its largest transaction in Africa to date. Under the terms of the deal, expected to close in the summer 2017, about 430 Shell Gabon local employees will be transferred to Assala Energy. The Carlyle-backed oil company will also assume associated liabilities, including a loan of $285 million.

“Assala Energy will build on Shell’s 55-year legacy in Gabon by continuing to deliver responsible operations through best-in-class safety, environmental and social performance and transparent stakeholder partnerships," said David Roux, CEO of Assala Energy. "We are committed to ensuring long-term, sustainable growth and creating value."

The capital for the investment will come from two Carlyle funds – the $2.5 billion Carlyle International Energy Partners (CIEP) fund, which invests in global oil and gas assets, and the $698 million Carlyle Sub-Saharan Africa Fund (SSA) fund. The private equity firm said the transaction accommodates for a potential additional payment of $150 million, subject to commodity price and production performance.