Royal Dutch Shell subsidiary Shell Enterprises LLC has struck a deal to shed its Permian Basin business to ConocoPhillips for $9.5 billion in cash, a company release announced Monday.

“After reviewing multiple strategies and portfolio options for our Permian assets, this transaction with ConocoPhillips emerged as a very compelling value proposition,” Wael Sawan, Upstream Director, for Shell said in a statement. “This decision once again reflects our focus on value over volumes, as well as disciplined stewardship of capital. This transaction, made possible by the Permian team’s outstanding operational performance, provides excellent value to our shareholders through accelerating cash delivery and additional distributions.”

The assets include 225,000 net acres that have a combined output of about 175,000 barrel equivalent per day. A separate release issued by ConocoPhillips said the sale will also involve over 600 miles of operated crude, gas and water pipelines and infrastructure.

Shell noted in its release that the Permian business posted a before tax operating loss of $491 million for the year that ended on December 31, 2020. The sale will result in an after-tax gain of $2.4 billion to $2.6 billion.

“We were presented with a unique opportunity to add premium assets at a value that meets our strict cost of supply framework and brings financial and operational metrics that are highly accretive to our multi-year plan,” Ryan Lance, chairman and CEO of ConocoPhillips stated. “Our financial strength allowed us to structure a competitive offer for this transaction and we are very excited to enhance our position in one of the best basins in the world with the addition of Shell’s high-quality assets and talented workforce.”

Most workers employed in Shell’s business will be offered positions with ConocoPhillips following the close of the transaction.

The companies expect the sale to close in the fourth quarter of 2021.