PERTH (miningweekly.com) – Petroleum major Royal Dutch Shell on Friday reiterated its commitment to investing in Australia, after announcing the A$2.9-billion sale of its downstream assets in the country to oil major Vitol.

Country chair Andrew Smith told journalists that the offer from Vitol followed on from Shell’s strategy to generate some $15-billion in cash from divestments over the coming two years.

The sale covers Shell’s Geelong refinery and 870 service station business, along with its bulk fuels, bitumen, chemicals and part of its lubricants businesses in Australia.

It also included a brand licence arrangement and an exclusive distributor arrangement in Australia for Shell lubricants.

Smith said that the sale would not include the aviation business, which will remain with Shell Group, or the lube oil blending and grease plants in Brisbane, which would be converted to bulk storage and distribution facilities.

“Like any business that operates for over a century, Shell’s business has changed over the years, and we are pleased to have found a buyer for the Geelong refinery. Through the brand agreement reached with Vitol, the Shell brand will continue to be displayed across the company’s service station network and customers will still have access to quality Shell fuels and lubricants,” said Smith.

He noted that despite the sale of the downstream business, Shell would continue to play a significant role in the development of Australia’s expanding liquefied natural gas (LNG) industry, adding that the company was looking forward to “strengthening its presence” in the sector, in the years ahead.

The company was currently developing the Prelude floating LNG plant, offshore Western Australia, and was also a joint venture partner in the North West Shelf project and the Gorgon project, being developed by major Chevron.

Earlier this year, Shell sold its 8% equity stake in the Wheatstone-Iago JV and its 6.4% interest in the Wheatstone LNG project for $1.13-billion.

Vitol president and CEO Ian Taylor said on Friday that the company was content to invest in Australia, adding that it had no intention of shutting down the Geelong refinery.

Staff currently working at Shell’s downstream division would remain at the sites, but would now fall under the Vitol banner.