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Shell expects to split Motiva assets with Saudi Aramco in second quarter

Published 06/02/2017, 19:05
Updated 06/02/2017, 19:10
© Reuters.  Shell expects to split Motiva assets with Saudi Aramco in second quarter
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HOUSTON (Reuters) - Shell Oil Co, the U.S. unit of Royal Dutch Shell Plc (L:RDSa), said on Monday it expects to divide the refineries and other assets of the Motiva Enterprises [MOTIV.UL] joint venture with co-owner Saudi Aramco in the second quarter of 2017.

"We are pleased with the progress we have made to date, and anticipate completion of the transaction in Q2 2017," Shell spokesman Ray Fisher said in an email. "The April 1 date is a target that the internal project teams are working toward."

Neither Motiva nor Saudi Aramco representatives were immediately available on Monday to discuss Shell's statement.

Rumours have swirled through U.S. refined products markets that the split would be delayed until the fall.

Shell and Saudi Aramco said in March 2016 they would divide up the 20-year-old joint venture, which operates three refineries, including the United States' largest, on the Gulf Coast.

Originally, the two companies targeted October 2016 for the split of assets, including pipelines and terminals as well as the refineries.

The major sticking point, sources told Reuters, was Shell's demand for a $2 billion payment as part of the breakup.

Under the plan for the division of assets, Saudi Aramco will retain the Motiva name and the 603,000-barrel-per-day (bpd) Port Arthur, Texas, refinery, the nation's largest.

Aramco would also take over 26 distribution terminals and have exclusive licence to use the Shell brand for gasoline and diesel sales in Texas, the majority of the Mississippi River Valley, and the Southeast and Mid-Atlantic markets.

Shell is slated to become sole owner of two Louisiana refineries with a combined capacity of 472,700 bpd and Shell-branded gasoline stations in Florida, Louisiana and the U.S. Northeast.

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