Royal Dutch Shell signs Letter of Intent for the sale of two French refineries

abarrelfull wrote on 28 Jan 2013 11:47
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02 Aug 2007

As part of an ongoing strategy of portfolio management, Shell International Petroleum Company Limited (Shell) has signed a Letter of Intent with Petroplus Holdings AG relating to the possible sale of two of its French refineries. Shell and Petroplus will discuss detailed terms, including developing a processing arrangement for the production of speciality products such as lubricants, with a view to agreeing and concluding a potential sale during 2008.
The sale, which would be part of an ongoing strategic review of a number of Shell’s refining and petrochemicals assets, would include the Petit Couronne and Reichstett Vendenheim refineries and associated infrastructure and businesses.

The sale would be subject to staff consultation and regulatory approval. Shell will be working closely with the appropriate trade unions and staff representatives as it has been doing since the announcement to review the ownership of the assets was made in January 2007.

A purchase price of $875 million, including working capital which is expected to be approximately $400 million, has been agreed. The two refineries have a combined capacity of 220,000 barrels per day. Shell will continue to serve its customers in France in a range of businesses including retail, commercial road transport, lubricants, LPG, aviation and bitumen.

“The deal is consistent with our strategy of ‘more upstream, profitable downstream’, where we aim to focus and simplify the portfolio of the Downstream business to those areas that give us the best returns and allow us to use capital to invest in growth markets. We believe this deal is in the long-term best interests of our shareholders, staff and customers,” said Rob Routs, Executive Director Oil Products and Chemicals, Royal Dutch Shell plc.

In addition to the Petit Couronne and Reichstett Vendenheim refineries, Shell owns the Berre-l'Etang refinery site complex in France, which is not part of the deal with Petroplus.

• Royal Dutch Shell signs Letter of Intent for the sale of two French refineries

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