Shell “’ implementing
a significant withdrawal
from Africa
 
The Hague, Netherlands — ESI-AFRICA.COM — 21 February 2011 – Royal Dutch Shell plc “’ Europe’s biggest oil company “’ has decided to sell its retail fuels business in 14 African countries for US$1 billion as part of a plan to streamline its marketing operation worldwide.

Vitol Group and Helios Investment Partners LLP “’ an Africa-focused private equity firm “’ will form a joint venture to take control of most of Shell’s fuel marketing operations on the continent, Geneva-based Vitol said in a statement. Shell may put assets from five more countries into the venture.

“We will significantly reduce our capital exposure in line with our strategy to concentrate our global downstream footprint while continuing to provide products under the Shell brand to customers in Africa,” Shell downstream director Mark Williams said in the statement.
 
“Shell is targeting asset sales of as much as US$5 billion this year,” CEO Peter Voser said in a recent earnings report on Feb. 3. “The company has sold about US$30 billion of assets worldwide over the last five years.

Vitol “’ the world’s largest independent oil trader “’ and Helios will take control of Shell’s business fueling retail, commercial, aviation and marine customers as well as lubricants and liquefied petroleum gas in the countries. Shell will hold a 20% stake in the new company.

The agreement covers Shell’s businesses in: Morocco, Tunisia, Ivory Coast, Egypt, Burkina Faso, Ghana, Senegal, Mali, Guinea, Cape Verde, Kenya, Uganda, Madagascar and Mauritius. The Egypt operations exclude lubricants.

Shell is still considering whether to add its businesses in Namibia, Botswana, Togo, Tanzania and La Reunion in the future, according to the statement.

The agreement, subject to regulatory approval, would be implemented in phases by the end of the first half of 2012. Not included in the agreement are Shell’s fuels unit in South Africa, its lubricants business in Egypt, its oil exploration programmes, its trading operation and its liquefied natural gas assets.