Royal Dutch Shell Plc is weighing the sale of its 211,146 barrel-per-day (bpd) Convent, Louisiana, refinery, the company said on Tuesday, Reuters reported.
Robin Mooldijk, Shell’s executive vice president of manufacturing, told employees in an internal message on Tuesday about the possible sale of the refinery, located 58 miles (93 km) west of New Orleans, according to sources familiar with plant operations.
Shell took sole ownership of the refinery on May 1, 2017, when Motiva Enterprises became a wholly-owned subsidiary of Saudi Aramco. Motiva had been a joint-venture between the two companies for 15 years.
Shell spokesman Curtis Smith said the possible sale was part of the company’s plan announced in 2019 to structure its operations to match the future market for downstream products.
“The remaining core sites will be advantaged by way of increased integration with Shell trading hubs and by producing more chemicals and related products expected to be resilient in a low-carbon future,” Smith said in an email.
Shell has not announced consideration of a possible sale of its 227,400 bpd Norco, Louisiana, refinery which produces motor fuels and also supplies feedstocks to the company’s adjoining chemical plant.
Along with the refinery, Shell plans to sell “its associated co-located logistics infrastructure - the products truck terminal, marine docks, Sorrento, Louisiana, salt cavern LPG storage, and line history rights for Bengal Pipeline,” Smith said.
In February, Shell sold its 156,400 bpd Martinez, California, refinery and logistics assets to PBF Energy for $960 million plus the price for oil and refined products on hand.
That would set the pre-pandemic price for refining assets at about $6,000 a barrel.
Because of reduced travel caused by the COVID-19 pandemic, U.S. refinery utilization fell to 68% of 19 million bpd in April. Utilization rose to 75.5% by the last week of June.
Reporting by Erwin Seba; Editing by Chris Reese and Tom Brown
