afrol News, 21 February - The major oil company Shell has sold its downstream businesses in 14 African countries for around US$ 1 billion. Shell products however still would be sold to Africa.
The giant transaction was announced by the oil product trading company Vitol and the "Africa-focused" finance investor company Helios, which jointly were buying Royal Dutch Shell's downstream operations in most African countries. This included retail, commercial fuels, liquefied petroleum gas, lubricants, bitumen, aviation and marine products under the Shell brand.
Under the agreements, two new joint venture companies said they would "assure continued availability of Shell fuels and lubricants in 14 African countries under the Shell brand," according to a statement issued by the Vitol Group.
The signed-off deal covers existing Shell downstream businesses in Morocco, Tunisia, Egypt, Côte d'Ivoire, Burkina Faso, Ghana, Senegal, Mali, Guinea, Cape Verde, Kenya, Uganda, Madagascar and Mauritius.
"Shell's downstream businesses in Namibia, Botswana, Togo, Tanzania and La Réunion are under review for potential inclusion in the deal at a later date," according to the Vital statement.
However, Shell's fuels, lubricants and refining activities in South Africa, the company's lubricants business in Egypt and its exploration and production businesses, liquefied natural gas interests and most international trading activities in Africa were "not part the proposed deal."
"Africa is a continent we know well," stated Vital CEO Ian Taylor. "These two new ventures allow us to invest in Africa and its fast-growing economies, and grow all the businesses under the umbrella of the world-class Shell brand for the benefit of our customers," he added.
The deal, which now needs to be authorised by government in several countries, was set to be effectuated in the first half of 2012, the three companies noted.
The sale of most of Shell's downstream assets in Africa represents one of the largest business transactions ever done regarding the African consumer market. It comes at a time with massive economic growth in Africa and a strongly growing middle class all over the continent.
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