VITOL and the Abu Dhabi Investment Council have bought Shell’s Geelong refinery and Australian petrol stations for $2.4 billion, according to media reports today.
Fairfax reports that the successful consortium came out on top over a group comprising Macquarie Capital and powerful miner-trader Glencore Xstrata.
The Geelong refinery has been formally on the market since April last year, after mother company Royal Dutch Shell announced plans to sell in its annual strategic update of March 2010.
The plan was part of a pitch to cut Shell’s global refinery capacity by 15 per cent and some 9000 petrol stations, and followed 5000 job cuts the previous year.
The future of 600 Geelong workers and contractors at the refinery is uncertain as Shell remains tight-lipped about the Vitol deal.
But the company’s website states: “A successful sale will mean that refining operations continue and jobs are preserved however, Shell cannot guarantee all roles with any new owner. As an operating refinery, a new owner will need a skilled and experienced workforce.”
The Shell sale followed serious refinery disruptions in 2011-12 and lost production worth at least $250 million when a $70 million maintenance fit-out and subsequent turbine/compressor breakdown in the refinery catalytic cracker’s power recovery unit closed operations for months.
This took several months to repairs and cost the company some $2 million a day in lost production _ in addition to lost production during the scheduled shutdown.
