Ivanhoe Energy Sells China Project to Shell (IVAN, RDS-A)

Canadian oil & gas company Ivanhoe Energy Inc. (NASDAQ: IVAN) has sold 100% of its stake in a production sharing contract in a Chinese natural gas project. Royal Dutch Shell plc (NYSE: RDS-A) has agreed to pay $160 million and assume a $20 million performance bond when the sale is completed.

The sale includes Ivanhoe’s stake in the Zitong block in China’s Sichuan basin, a tight-gas play that the company developed last year.

Ivanhoe expects the transaction to be completed by the end of December 2012. The company said it will use the proceeds from the sale “to focus our energy and resources on the commercialization of our Heavy-to-Light (HTL) heavy oil upgrading process and the development of our attractive oil projects.”