Shell sells its Australian downstream business to Vitol for $2.6 billion

Shell has agreed to sell its Australian downstream business to oil trading firm Vitol for $2.6 billion.

The sale includes Shell’s refinery in Geelong, 870 service stations, its bulk fuels and chemicals unit and part of its lubricants business.

However, Shell’s aviation business is excluded from the deal.

The oil giant is looking to dispose off assets as part of a strategy that will see the company “changing emphasis” in 2014.

The asset sales also come at a time when its profits have been declining.

Last month, Shell posted “clean” profits – which strip out the impact of oil price movements – of $2.9 billion for the October-to-December quarter, down from $5.6 billion during the same period a year ago.

“Australia remains important to Shell, but we are making tough portfolio choices to improve the company’s overall competitiveness,” Ben van Beurden, chief executive of Shell said in a statement.

Recent disinvestments by Shell include the sale of refineries in the UK, Germany, France, Norway and the Czech Republic.

The company has also offloaded its downstream businesses in Egypt, Spain, Greece, Finland and Sweden.

Shell said that majority of its downstream staff in Australia will continue to work under its new owner.

Shell and Vitol deal is subject to regulatory approvals and is expected to close within this year.