The iconic Bukom refinery, a jewel in Shell’s crown, has come into the crosshairs of Chinese corporations as the multinational contemplates a sale. It is said that Shell has called for non-committal proposals for its Singapore-based establishment, with leading Chinese organizations countering with a show of interest.
High-Level Chinese Entities Take Notice
Reports suggest that the China National Offshore Oil Company (CNOOC), alongside two leading chemical companies, has gravitated towards the potential opportunity. They are viewing the Singapore facilities, revered for their long-standing and illustrious service under Shell, with keen interest.
In what highlighted the dynamism and fluidity of the industry, Shell solicited the expertise of Goldman Sachs in August, commissioning the top-tier investment bank to examine the viability of selling their Singapore-based refining and petrochemical installations.
Lack of Uniform Interest Across China
The corporate scenario in China surrounding the possible acquisition was not uniform. While some displayed enthusiasm, Sinopec, another Chinese oil titan, expressed its lack of interest in the assets.
Meanwhile, CNOOC, together with Eversun Holdings and Wanhua Chemical, initiated preliminary assessments of Shell’s property. The infrastructure under scrutiny includes a 237,000 barrels per day refinery and an ethylene cracker with a yearly production capacity of one million metric tons, according to insiders.
Invitation to Express Interest Expands
Shell’s effort to gauge the market receptivity was far-reaching, with more than a dozen companies being drawn into the conversation. Separate reports suggest that those companies have been formally invited to elucidate their level of interest in Shell’s facilities, expanding the scope of the potential deal.
In response to queries from the press, Shell acknowledged that they are in the midst of a strategic evaluation of their assets in Singapore’s energy and chemicals park. They have also stated that they have considered a host of options, one of which is the divestment of their stakes. The decision marks a significant shift in the multinational corporation’s strategic priorities, given the archive of the Singapore assets.
