In a move that could reshape Malaysia’s petrol station landscape, Shell is reportedly in discussions with Saudi Arabia’s state-owned Saudi Aramco regarding the potential sale of its petrol station business in the country. The deal, estimated to be worth as much as US$1 billion (RM4.74 billion), is said to be in advanced stages, according to industry insiders familiar with the matter.
While both Shell and Saudi Aramco have declined to comment on the ongoing talks, sources highlight the significance of Malaysia to Shell, where it owns approximately 950 petrol stations, making it the second-largest network in the country after Petronas.
The discussions, which reportedly began in late 2023, are expected to result in a finalised deal in the coming months, with estimated deal sizes ranging from RM4 billion to RM5 billion.
Shell’s operations in Malaysia extend beyond petrol stations to include the sale of industrial lubricants, offshore crude oil and natural gas production, and participation in liquefied natural gas ventures.
The potential sale aligns with Shell’s strategy under CEO Wael Sawan to divest from less profitable ventures. Shell aims to divest around 500 petrol stations in the next few years and is currently in the process of selling its Singapore refinery and petrochemical complex.
The move to sell its Malaysia petrol stations is seen as consistent with Shell’s decision to divest its refinery on Bukom Island in Singapore, which supplies the Malaysian network.
Although Saudi Aramco does not operate petrol stations in Malaysia, it holds a 50% stake in the Pengerang refinery in Johor, a joint venture with Petronas. This refinery has a capacity of 300,000 barrels per day and supplies petrol for domestic use and export.
Aramco’s potential acquisition of Shell’s petrol station business in Malaysia could further solidify its presence in the region, where it already has significant investments in refining and petrochemicals.
