Energy giant Shell is in talks with Saudi Arabia’s state-owned Saudi Aramco to sell its gas station business in Malaysia, the second-largest such network in the country. The potential deal could be worth up to $1 billion.
Shell, which wholly owns around 950 fuel stations across Malaysia, declined to comment on the talks but said Malaysia is an important country to the company. Saudi Aramco also declined to comment.
The talks began in late 2023, and a deal may be finalized in the coming months. Industry sources put the potential deal size at roughly 4 billion to 5 billion ringgit ($844 million to $1.06 billion).
In addition to its fuel stations, Shell sells industrial lubricants, produces crude oil and natural gas offshore of Sarawak and Sabah states, and is a joint venture partner in two liquefied natural gas (LNG) ventures.
The sale is part of CEO Wael Sawan’s efforts to focus the company’s operations on the most profitable businesses. Shell has said it would look to divest 500 gas stations this year and next, and it is in the process of selling its Singapore refinery and petrochemical complex.
Saudi Aramco does not have fuel stations in Malaysia, although it owns 50% of the 300,000-barrel per day (bpd) Pengerang refinery in Johor in a joint venture with Petronas, which sells fuel domestically and for export. Aramco operates petrol stations in Saudi Arabia and also operates fuel stations elsewhere in joint ventures with other major energy companies.