Shell Singapore divests Energy and Chemicals Park to CAPGC in strategic portfolio optimization

In a strategic move to optimize its portfolio, Shell Singapore Pte Ltd, a subsidiary of Shell plc, has agreed to sell its Energy and Chemicals Park in Singapore to CAPGC Pte. Ltd. This joint venture between Chandra Asri Capital Pte. Ltd. and Glencore Asian Holdings Pte. Ltd. will acquire all of Shell’s interests in the facility, including physical assets and commercial contracts. The transaction is a significant component of Shell’s ongoing efforts to refine its Chemicals and Products business to deliver enhanced value with reduced emissions.

Huibert Vigeveno, Shell’s Downstream, Renewable and Energy Solutions Director, highlighted the significance of the agreement: “This agreement marks a significant step in Shell’s ongoing efforts to high-grade our Chemicals and Products business, and is a testament to our commitment to deliver more value with less emissions, as outlined at our Capital Markets Day last year.” This sale is part of a broader strategy to realign Shell’s global operations towards more sustainable and efficient practices.

The Shell Energy and Chemicals Park Singapore encompasses integrated refining and chemical assets located on Pulau Bukom and Jurong Island. These facilities include a 237,000 barrels-per-day refinery, a 1.1 million tonnes-a-year ethylene cracker, and Shell’s largest petrochemical production and export center in the Asia Pacific region. These assets represent a substantial part of Singapore’s petrochemical capacity and have been instrumental in the country’s economic growth in this sector.

The transaction, expected to close by the end of 2024 pending regulatory approval, includes provisions for all dedicated employees at the Shell Energy and Chemicals Park Singapore to retain their positions under the new ownership of CAPGC. This ensures continuity and stability for the workforce and ongoing operational reliability and safety.

Post-sale, Shell and CAPGC will enter into crude supply and product offtake agreements, emphasizing the sustained business relationship between the two entities. Furthermore, Shell continues to invest in Singapore’s sustainability initiatives, including electric vehicle charging infrastructure and a cross-border carbon capture and storage project in collaboration with the Singapore government and ExxonMobil.

The divestiture of the Energy and Chemicals Park aligns with Shell’s strategic vision to streamline its operations and focus on high-value, low-emission activities. The sale not only reflects Shell’s adaptive strategies in response to changing market conditions but also reaffirms its commitment to supporting Singapore’s long-term economic and environmental goals. Through strategic restructuring and continued investment in innovative energy solutions, Shell aims to maintain its role as a key player in the region’s energy sector.