Shell Offshore Inc., a subsidiary of Shell plc, will sell its 100% interest in Shell Onshore Ventures LLC to IKAV for about $2 billion, the company announced.

Shell Onshore Ventures holds a 51.8% membership interest in Aera Energy LLC. The sale is for a total consideration of approximately $2 billion in cash with additional contingent payments based on future oil prices, subject to regulatory approval.

The transaction has an effective date of October 1, 2021, and is expected to close in Q4 2022.

“This decision supports our strategy to create a resilient and competitive Upstream portfolio by focusing on positions with high growth potential and a strong integrated value chain,” said Zoe Yujnovich, Shell’s Upstream Director.

Headquartered in Bakersfield, California, Aera Energy LLC is operated as an independent company.

While this transaction will end Shell’s Upstream position in California, Shell will remain active in the state through a variety of other assets and projects.