Shell has announced an agreement to sell its refinery and petrochemical assets in Singapore, Asia’s primary oil hub, to a joint venture between Indonesian chemicals firm Chandra Asri and Swiss miner and commodities trader Glencore.
This move comes as part of Shell’s broader strategic review to reduce its carbon footprint and focus on its most profitable businesses, led by CEO Wael Sawan.
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The transaction will involve transferring all of Shell’s interest in Shell Energy and Chemicals Park Singapore to the joint venture company CAPGC, subject to regulatory approval and expected to be completed by the end of 2024, Shell said.
Although the companies did not disclose the deal’s value, it represents a significant step in Shell’s efforts to streamline its operations and transition towards a lower-carbon future.
Shell’s assets in Singapore include a refinery with a processing capacity of 237,000 barrels per day (bpd) of oil and a 1-million-metric-ton-per-year (tpy) ethylene plant on Bukom island, along with a mono-ethylene glycol plant on Jurong island.
The sale offers Chandra Asri and Glencore a strategic foothold in one of the world’s top refining and trading centers, despite facing competition from newer facilities in China and elsewhere.
For Chandra Asri, acquiring Shell’s plants enables integration of petrochemical production with refining, potentially improving efficiency and reducing costs.
Additionally, Glencore’s involvement provides trading expertise and logistical support, enhancing the joint venture’s capabilities in the Asian market.
According to Reuters, shares of Chandra Asri Pacific rose following the announcement, reflecting investor optimism about the company’s expanded presence in the region.
Meanwhile, Shell’s shares in London also saw a modest increase, signaling confidence in the company’s strategic direction and financial performance.
