Shell and Kuwait Petroleum International (KPI) announce last Thursday that their respective affiliates have reached an agreement for the sale of shares in the companies containing the Retail, Supply and Distribution logistics and Aviation businesses in Italy. The sale is subject to regulatory approval and is expected to complete in 2014.

Under the agreement Shell’s Retail network will be re-branded to Q8.

Shell’s non-service station Lubricants, Marine, Gas & Power and Upstream businesses in Italy are not impacted by the sale and will continue to operate as before. Shell will continue to operate its Lubricants business through Shell Italia Oil Products and its Gas & Power business through Shell Energy Italia.

Then last Friday, Shell announced it has reached a binding agreement to sell its Australia downstream businesses (excluding Aviation) to Vitol for a total transaction value of approximately A$2.9 billion (US$2.6 billion).

The sale covers Shell’s Geelong Refinery in Victoria state and 870-site retail business - along with its bulk fuels, bitumen, chemicals and part of its lubricants businesses in Australia. It also includes a brand license arrangement and an exclusive distributor arrangement in Australia for Shell Lubricants.

It does not include the Aviation business, which will remain with Shell Group, or the lube oil blending and grease plants in Brisbane, which will be converted to bulk storage and distribution facilities. The majority of Shell’s downstream staff in Australia will continue to operate the business under its new owner.

Shell spokesperson Mary Walsh told OEM/Lube News "In the case of the agreed sale in Italy, the full lubricants business is not in and it will continue to operate as today with no impact for customers. For Australia, where a binding agreement to sell has been reached the main Lubricants part of the lubricants business will in the future be run via a distributor arrangement. This means Shell branded products and associated services will continue to be available to Australian customers. The Distributor is supported by Shell with access to product training and technical assistance. Each Distributor responsibility to implement sales and marketing programmes for Shell lubricants products including storage and in-country distribution."

Ben van Beurden, Shell’s Chief Executive Officer, said: “Australia remains important to Shell, but we are making tough portfolio choices to improve the company’s overall competitiveness. Our customers will continue to benefit from the quality associated with the Shell brand and we are confident Vitol will invest in and grow the business.”

Vitol President and CEO Ian Taylor said: “This is an exciting acquisition for us, a good company led by an experienced management team and underpinned by the value of the Shell brand. Australia is a growing economy and we look forward to working with the management team to strengthen and grow the business.”

The deal is subject to regulatory approvals and is expected to close in 2014.

Shell stated that these sales are consistent with its strategy to concentrate Shell’s Downstream footprint on a smaller number of assets and markets where it can be most competitive. Recent downstream divestments by Shell include the sale of refineries in the UK, Germany, France, Norway and the Czech Republic; downstream businesses in Egypt, Spain, Greece, Finland and Sweden, as well as the creation of a downstream joint venture with Vitol and other partners across Africa.