(Add Shell comment, Pemex statement on operation)
By Erwin Seba and Dave Graham
HOUSTON/MEXICO CITY, May 24 (Reuters) - Royal Dutch Shell
agreed on Monday to sell its controlling interest in a
Texas refinery to partner Petroleos Mexicanos (Pemex) for about
$596 million, the latest move by the European oil major to cut
its global refining footprint.
The deal makes the Deer Park, Texas, facility the first
foreign refinery that Mexico's state-run oil company will own
solely in its history. The agreement was announced not long
after Mexican President Andres Manuel Lopez Obrador complained
that the 28-year-old joint venture had not been good for Mexico.
Shell is shrinking its refining and chemicals portfolio as
part of a broader shift by oil majors to reduce hydrocarbon
emissions and shift to lower-carbon fuels.
Pemex said it plans to control and run the refinery after
the deal closes late this year.
"This decision is consistent with Lopez Obrador's strategy
of refining more. However, it casts many doubts about Deer
Park’s future profits, especially after seeing the margins of
just cents per barrel that Pemex is getting in its domestic
refineries," said said Gonzalo Monroy, a Mexico City-based oil
analyst.
Lopez Obrador hailed the deal on Twitter after complaining
earlier this month about how the joint venture never repatriated
dividends, saying he was committed to "addressing this issue,"
without providing details.
"The most important thing is that in 2023 we will be
self-sufficient in gasoline and diesel," Lopez Obrador said on
Twitter. "There will be no increases in fuel prices," he added.
The refinery can process up to 340,000 barrels per day of
oil into gasoline and diesel. The joint venture was
significantly revamped three years ago in a move to halve the
facility's purchases of Mexican crude beginning in 2023.
The complex covers 2,300 acres outside of Houston, including
an adjacent chemical plant that Shell will retain.
In 2018, Pemex agreed to renegotiate its contracts with
Shell to reinvest a portion of the refinery's profits into an
overhaul of the facility for processing a larger volume of
crudes different that Mexico's.
Huibert Vigeveno, Shell's downstream director, said in a
statement the company will continue working with Pemex "in an
integrated way, including through our on-site chemicals
facility."
The sale price includes cash, debt and inventories, Shell
said.
On May 4, Shell disclosed plans to sell its 149,000-bpd
Puget Sound refinery in Anacortes, Washington, to U.S. refiner
HollyFrontier.
(Reporting by Erwin Seba in Houston, Dave Graham, Ana Isabel
Martinez and Marianna Parraga in Mexico City, Devika Krishna
Kumar in New York, Nishara Karuvalli Pathikkal and Sumita Layek
in Bengaluru; Editing by David Gregorio and Dan Grebler)
