Shell divorce

18 March 2016 By Andy Critchlow

Shell and Saudi Aramco are negotiating the split of their Motiva joint venture, which spent $10 bln upgrading the United States’ biggest refinery. Shell gets some assets and potentially some cash. But the unwind’s opacity makes it hard to tell which side gets the better deal.

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Royal Dutch Shell and its partner Aramco said on March 16 that they plan to dissolve their Motiva Enterprises joint refining and petroleum products marketing joint venture. As part of the separation, Aramco will take sole ownership of the Port Arthur refinery in Texas, which is the largest such plant in the United States. The Saudi state oil company will also retain 26 distribution terminals and a licence to gasoline and diesel in the United States using the Shell brand.

Shell will retain the smaller Norco and Convent refineries while also receiving a cash payment from Aramco. The division of assets and liabilities in addition to the exact structure of the deal are yet to be finalised, both companies said.

Aramco disclosed in May 2013 that $10 billion had been invested in its joint venture to upgrade Port Arthur.

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