Shell sold its 270,000 barrel-a-day Stanlow refinery to Essar Oil for $1.3 billion (€921 million), it was confirmed yesterday.
Essar made the offer for the refinery in February 2011 and the acquisition includes all oil products, chemicals manufacturing, terminal assets and the commercial bulk fuels and local marine businesses relating to the refinery. The Stanlow refinery is the country’s second biggest and produces about 3.5 billion litres of petrol a year, for both cars and aeroplanes, as well as other transport.
However, the purchase does not include any of Shell’s retail outlets, higher olefins plant and alcohol units, the lubricant oils blending plant, lubricants marketing business, Shell aviation operations at airports, non-local marine business, marine lubricants, commercial road transport marketing businesses, bitumen marketing business or the Shell technology centre at Thornton.
The acquisition is expected to be finalised by H2 2011.
Shell’s downstream director Mark Williams says: ‘The decision to sell Stanlow is part of our drive to concentrate our global manufacturing portfolio on larger assets and, on completion, means we will have reduced our global refining exposure through a combination of asset sales and closures by a total of 1.6 million barrels since 2002.’
‘This deal serves Stanlow’s future well given Essar’s commitment to investment and intent to increase site throughputs,’ says Frank Willsdon, Stanlow general manager. ‘It can only benefit staff, business partners and the local community and region. After our many years with Shell, we now look forward to a smooth transition and moving forward with Essar.’
Following the sale, the two businesses will sign a five year crude supply contract from Shell to Essar and a long-term agreement for the supply of products in the UK from Essar to Shell.