Shell to sell interest in German joint-venture refinery

Vienna-based Alcmene GMBH, a subsidiary of privately owned Liwathon EOS of Estonia, has entered an agreement with Royal Dutch Shell PLC for the purchase of Shell Deutschland Oil GMBH’s 37.5% minority interest in PCK Raffinerie GMBH's 220,000-b/d refinery in Schwedt, Germany, located along Druzhba pipeline in Schwedt, Germany, about 120 km northeast of Berlin.

Pending approval by PCK Raffinerie’s remaining joint venture partners PJSC Roseneft subsidiary Rosneft Deutschland GMBH (54.17%) and Eni SPA subsidiary Eni Deutschland GMBH (8.33%) as well as other regulatory approvals, the transaction is slated to close by yearend, Shell said on July 8.

While it did not reveal specific details regarding an overall value of the proposed sale, Shell said hydrocarbon inventory included as part of the deal—which range between $150-250 million—would be valued at closing based on actual volumes and prevailing market prices.

Shell said divestment of its interest in PCK Raffinerie comes as part of the global operator’s broader strategy to reduce its global refinery footprint to core sites integrated with the company's trading hubs, chemicals plants, and marketing businesses (OGJ Online, May 27, 2021; May 5, 2021; Feb. 1, 2021; Nov. 10, 2020; Nov. 6, 2020).

Specifically, the sale will support the company’s further development of Shell’s Rheinland energy and chemicals park, according to Robin Mooldijk, Shell’s executive vice-president of manufacturing.

The Rheinland energy and chemicals park includes Shell Deutschland’s 140,000-b/d refinery at Wesseling, Germany, which together with the former Godorf refinery near Cologne-Godorf, form the 325,000-b/d integrated Rheinland refinery, Germany’s largest.

Shell previously attempted to shed its interest in the Schwedt refinery in late 2016 to Varo Energy BV (OGJ Online, Dec. 20, 2016).