ExxonMobil has agreed to divest its stake in Esso Thailand, which owns a local refinery and retailing business, to Thai energy firm Bangchak.

ExxonMobil’s affiliate ExxonMobil Asia Holdings owns a 65.99% interest in Esso Thailand, which owns the Sriracha Refinery, select distribution terminals, and a network of Esso-branded retail stations.

As part of the deal, Bangchak will acquire 66%, or 2.28 billion ordinary shares, of Esso Thailand from ExxonMobil Asia Holdings. The deal values the shares of Esso at THB20.1bn ($603bn).

ExxonMobil, however, will continue to hold the finished lubricant and chemical marketing businesses.

The sale forms part of the US oil company’s efforts to focus on its market in the US and the production of lower-emission fuels, reported Bloomberg News.

ExxonMobil product solutions president Karen McKee said: “As we execute our strategy, ExxonMobil is focusing its investments on global production facilities to meet the world’s demand for lower-emission fuels and high-performance products while divesting assets where others see the potential for greater value.

“We appreciate the talent and determination of our colleagues in Thailand who have safely provided reliable product supply to the Thailand and Greater Mekong markets for more than 125 years, and we thank them for their dedicated service.” 

Following the completion of the transaction with ExxonMobil, Bangchak is planning to launch tender for the remaining 34% of shares in Esso Thailand. This will be subject to securing regulatory approvals.

Bangchak group CEO and president Chaiwat Kovavisarach said: “This investment is a step towards greater energy security, balancing our long-term strategy with energy affordability and sustainability.”

Bangchak expects the transaction to provide important catalysts for its additional growth and margin improvement efforts.

Subject to receiving regulatory approvals, the transaction is anticipated to close in the second half of 2023.