Oil major Shell Tuesday signed an agreement to sell its downstream business in Argentina to Raizen for $950 million in cash proceeds at completion, subject to customary closing conditions, before end of the year.
Raizen is a joint venture set up in 2011 between Shell and Brazil biofuels producer and fuels distributor Cosan, which already manages more than 6,000 Shell service stations.
The sale includes the Buenos Aires Refinery, around 645 retail stations, liquefied petroleum gas, marine fuels, aviation fuels, bitumen, chemicals and lubricants businesses, as well as supply and distribution activities in the country.
Businesses acquired by Raizen will continue their relationships with Shell through various commercial agreements after the transaction, which represent an estimated value of $300 million.
“We plan to continue thriving in Argentina’s downstream market through Raizen,” says John Abbott, Shell Downstream Director.
“Raizen has already delivered significant value for us in Brazil and we will remain an important fuel supplier to Argentina under this deal.”
The development is consistent with its strategy to simplify its portfolio through a $30 billion divestment programme following a strategic review of its Argentina downstream business that began in August 2016, notes Shell.
The sale does not include Shell’s upstream interests in the Vaca Muerta shale formation.
Published: 26 April, 2018
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