Shell Oil Co, the U.S. arm of Royal Dutch Shell Plc, on Thursday reaffirmed the target date to split up the Motiva Enterprises [MOTIV.UL] refining joint venture with co-owner Saudi Aramco [IPO-ARMO.SE] would be May 1.
Shell and Saudi Aramco in March 2016 announced the plan to divide up the nearly 20-year-old venture, which runs three refineries and other assets. The date of the split has been pushed back twice since the announcement.
As part of the deal, Saudi Aramco will make a $2.2 billion balancing payment to Shell. Of that total, Aramco will only have to pay about $700 million in cash to Shell, with the remainder satisfied by Aramco assuming most of Shell’s half of the $3.2 billion debt held by Motiva.
Shell will only assume $100 million of the debt.
Saudi Aramco will become the sole owner of the 603,000 barrel per day (bpd) Port Arthur, Texas, refinery, the largest in the United States.
Saudi Aramco will also take over 24 distribution terminals and have an exclusive license to use the Shell brand for gasoline and diesel sales in Texas and the majority of the Mississippi River Valley as well as the U.S. Southeast and Mid-Atlantic markets.
Shell will become sole owner of two Louisiana refineries with a combined capacity of 472,700 bpd, 11 distribution terminals and Shell-branded gasoline stations in Florida, Louisiana and the U.S. Northeast.
(Reporting by Erwin Seba, editing by G Crosse)