Shell may sell servos, or ditch Australian digs
Shell may be looking to sell its 900 Australian petrol stations, after it reported a 39 per cent drop in annual profits.
An assessment of its liquefied natural gas investments in Australia has been undertaken, with Shell saying it wants to rid itself of $17 billion worth of global assets.
It seems many Shell service stations could be re-branded, along with the possible sale of 32 Australian fuel terminals.
Shell’s Geelong petroleum refinery has been on the market since 2013.
There may be a buyer for the service stations already, but the oil and gas company is keeping the lid on it for now.
“We have an expression of interest in our downstream business in Australia refining and part of our marketing businesses and that's frankly all I can say about it at this stage,” chief executive Ben Van Beurden said.
“We never comment on things that are ongoing in the M&A [mergers and acquisitions] space.”
“If there is something to announce we will do that as soon as the milestone is there.”
The company has been similarly silent on its plans for LNG projects in Queensland, with no decision to be made just yet on its Gladstone liquid gas project, run by Arrow Energy.
“We are sorting through all our options in LNG, including Arrow, to see how we take it forward... and therefore it will be a matter of prioritising and phasing because we can't do them all,” Mr Van Beurden said in a recent interview.
“So this will be a high-grading exercise rather than a searching exercise.”
Energy market analyst Peter Escho says it is not surprised Shell wants to ditch a number of its Australian assets.
“There's a lot of pressure on Shell from its shareholders to generate a more adequate return on its capital, on its assets, and so these are legacy assets,” he said.
“Shell can probably reinvest the capital elsewhere and earn a higher return.
“I wouldn't be surprised if perhaps some of the large conglomerates in Asia look at this opportunity to expand their brand.”