Essar strikes £219m deal for Stanlow
ESSAR Energy has finalised a £219m deal with Shell to buy the Stanlow oil refinery in Cheshire.
Stanlow, near Ellesmere Port, is the country’s second biggest oil refinery. It produces 272,000 barrel-per-day and employs 960 people.
Mauritius-based Essar, which operates mostly in India, said the deal would give it direct access to the UK market and enable it to export products from its refinery in Gujarat state, India.
Naresh Nayyar, Essar’s chief executive, said: “We are very pleased to have agreed this transaction with Shell. Stanlow is a high quality refinery and is an excellent fit with our strategy.
“We look forward to taking ownership of Stanlow in due course and making operational improvements which will enhance production and better optimise the facility.”
A separate payment will be made for the crude oil and refined products at the site which is expected to take the price to £700m.
Stanlow and other sites in Germany and Canada are being sold as Shell shifts its focus in this “downstream” part of the business to China and Asia.
It is cutting 560,000 barrels a day of capacity in the light of a $1.8bn loss from downstream operations between November and February.
The acquisition will be completed during the second half of 2011.
