Indonesian billionaire Prajogo Pangestu’s Chandra Asri and commodities trader Glencore have entered into a joint venture to purchase Shell’s refinery and chemical assets in Singapore. The deal, expected to be completed by the end of the year, will see CAPGC taking over Shell’s interests in Shell Energy and Chemicals Park Singapore, which includes a refinery capable of producing 237,000 barrels of oil per day, an ethylene cracker on Pulau Bukom, and a petrochemical plant on Jurong Island. While the financial terms of the transaction have not been disclosed, it is estimated to be worth around $1 billion.
Shell’s decision to divest its Singapore assets is part of its strategy to focus on high-value chemicals and products while reducing emissions. Huibert Vigeveno, director of Shell’s downstream, renewable, and energy solutions, emphasized the company’s commitment to delivering more value with fewer emissions through this agreement. Despite the divestment, Shell reaffirmed its commitment to Singapore, highlighting its importance as a regional hub for marketing and trading business. Shell also expressed its interest in continuing its partnership with Singapore as the country strives to decarbonize.
An analysis by Wood Mackenzie revealed that Shell’s Pulau Bukom facility is the weakest integrated refinery-petrochemical site in the company’s portfolio, prompting the decision to divest the assets. However, Singapore remains a key part of Shell’s operations in the region, and the company plans to maintain its presence in the country. As Singapore continues its journey towards decarbonization, Shell looks forward to ongoing partnerships with the country and its customers in the region.
In March this year, the Singapore government collaborated with a consortium formed by Shell and ExxonMobil to explore the feasibility of a cross-border carbon capture and storage project. This initiative reflects Singapore’s commitment to reducing emissions and transitioning towards a more sustainable future. The acquisition of Shell’s refinery and chemical assets by the joint venture led by Pangestu’s Chandra Asri and Glencore aligns with the ongoing efforts to transform the energy and petrochemical industry in the region.
The transaction between CAPGC and Shell marks a significant milestone in Shell’s efforts to streamline its chemicals and products business. With a focus on delivering more value while reducing emissions, Shell is strategically divesting assets that no longer align with its long-term business objectives. As the energy landscape evolves, partnerships like the one forged between CAPGC and Glencore will play a crucial role in shaping the future of the industry and driving sustainable growth in the region. Overall, the acquisition of Shell’s assets in Singapore underscores the changing dynamics of the energy sector and the shift towards cleaner and more efficient operations.
