Royal Dutch Shell, through its subsidiary, has divested its Puget Sound Refinery in Washington, US to a subsidiary of petroleum refiner HollyFrontier.
The deal, which was signed in May 2021, has an aggregate cash consideration of $613.6m.
This includes a $350m base cash purchase price, hydrocarbon inventory with around $266.2m estimated closing value, and $2.6m accrued liabilities.
HollyFrontier also acquired an on-site cogeneration facility and related logistics assets of the refinery from Equilon Enterprises LLC d/b/a Shell Oil Products US (Shell).
The refiner also purchased a light product loading rack, a deepwater marine dock, a rail terminal, and storage tanks with approximately 5.8 million barrels of product, crude, and other hydrocarbon storage capacity.
However, Shell will retain product offtake agreements. This would support the firm’s existing Pacific Northwest retail marketing business.
In a press statement, Shell said: “Shell will maintain Shell-branded businesses in the Pacific Northwest and has structured supply/offtake agreements with the new owner such that the Puget Sound Refinery will continue to support Shell’s businesses in the region.”
The sale excludes Shell’s off-site logistics assets.
Located in Anacortes, Washington, the Puget Sound Refinery currently has a processing capacity of approximately 149,000 barrels per day of crude oil.
The refinery is equipped to produce multiple types of gasoline, in addition to diesel fuel, fuel oil, propane, jet fuel, butane and petroleum coke.
The refinery sale forms part of Shell’s plans to reduce its global refinery footprint to core sites.
HollyFrontier president and CEO Mike Jennings said: “The refinery supplies transportation fuels into the premium Pacific Northwest region and sources advantaged Canadian crude, further enhancing our refining asset base.”