Shell has signed an agreement to sell its Russian retail and lubricants businesses to Lukoil, one of the largest vertically integrated oil and gas companies in the world.
The deal includes Shell’s Torzhok lubricant blending plant, around 200 km northwest of Moscow, which has blending capacity of 200m L/y. Also included are 411 retail stations, including 171 owned by dealers. These are mainly located in central and northwestern regions of Russia.
Huibert Vigeveno, Downstream Director at Shell, said that the company’s priority is the wellbeing of its employees. “Under this deal, more than 350 people currently employed by Shell Neft will transfer to the new owner of this business,” he added.
Shell Neft owns Shell’s retail and lubricants businesses in Russia. It is owned by Shell subsidiaries Shell Overseas Investments and Dordtsche Petroleum Maatschappij, which signed the deal with Lukoil. The sale is expected to be completed later this year.
Maxim Donde, VP for Refined Product Sales at Lukoil, said: “The acquisition of Shell’s high-quality businesses in Russia fits well into Lukoil’s strategy to develop its priority sales channels, including retail, as well as the lubricants business.”
Shell announced on 8 March that it would withdraw from Russian hydrocarbons in a phased manner, following the country’s invasion of Ukraine. Before it announced the withdrawal, Shell said it was exiting its joint ventures with Russia’s majority state-owned energy firm Gazprom and its related entities.