Shell to sell downstream businesses in 21 African countries
03 Apr 2010
Royal Dutch Shell Plc, Europe's largest oil company, said today that it will sell its downstream businesses in 21 countries in Africa, as the oil major aims to focus on its larger revenue generating projects and exit less profitable businesses.
The multinational petroleum company of Dutch and British origins will sell its retail, commercial fuels, lubricants, liquefied petroleum gas (LPG), bitumen, aviation and marine businesses in Morocco, Algeria, Tunisia, Egypt, Cote d'Ivoire, Burkina Faso, Ghana, Togo, Senegal, Mali, Guinea, Cape Verde, Kenya, Uganda, Tanzania, Botswana, Namibia, Madagascar, Mauritius and La Reunion, as well as the LPG business in South Africa.
This announcement comes after the Hague-based company said last month that it is selling 35 per cent or 6,500 petrol stations worldwide and exit from 15 per cent of its world-wide refining capacity, which, it said, would save the company $4-billion and bring itself to a surplus cash flow position by 2012. (See: Shell to exit 35 per cent petrol stations worldwide, cut 2,000 jobs)
"The review is consistent with our strategy to concentrate our global downstream footprint and follows a number of similar reviews and divestments in other parts of the world," Mark Williams, Royal Dutch Shell's Downstream director, said.
"Shell's programme of downstream asset sales will continue through planned exits from 15 per cent of our world-wide refining capacity and 35 per cent of our current retail markets, which equates to about 5 per cent of Shell-branded retail sites around the world."
Based on the assets earnings and premiums being paid in such a transaction, analysts expect the proposed sale of Shell's African downstream business to fetch around $1.5 billion.
Shell said it was selling the African downstream business as it wanted to refocus its global downstream footprint into fewer, larger markets.
