Shell Oil Company, a subsidiary of Royal Dutch Shell, announced on Monday that it agreed to sell its controlling interest in the Deer Park refinery in Houston, Texas to its partner Mexican state oil company Pemex for $596 million.
The Deer Park Refining Limited Partnership was a 50-50 joint venture between Shell and Pemex subsidiary, P.M.I. Norteamerica.
The transaction is anticipated to be worth in the region of $596 million in a combination of cash and debt, including the value of hydrocarbon inventory.
“Shell did not plan to market its interest in the Deer Park refinery; however, following an unsolicited offer from Pemex, we have reached an agreement to transfer our interest in the partnership to them,” Huibert Vigeveno, Shell’s downstream director, was quoted as saying in a statement.
With Pemex’s 30-year partnership in the Deer Park Refinery, Vigeveno said his company would continue to collaborate with Pemex in an integrated way through the company’s on-site chemicals facility, which Shell will retain.
In a Twitter message on Monday, Mexico’s President Andres Manuel Lopez Obrador also confirmed the buyout.
"Today, we closed the operation to buy the Deer Park refinery in Houston, Texas owned by Shell. Now Pemex will have 100% of the shares. The most important thing is that in 2023, we will be self-sufficient in gasoline and diesel; there will be no increases in fuel prices,” he said.
Expected to close in the last quarter of 2021, Shell said the transaction allows it to further focus its refining footprint, while also “maintaining integration optionality and retaining value through its chemicals and trading activities.”
By Sibel Morrow