Shell Seen Shedding $1bn-plus of Argentine Assets

A sale of Shell’s downstream Argentine assets could fetch more than $1bn and would be in line with the company’s regional strategy, market sources say. The Quineco unit of Chile’s Luksic group is rumored to be close to signing a deal to buy Shell’s 700 service stations, Dock Sud refinery and the Barracas lubricant plant, in what would be a follow-up to its purchase agreed in May to buy Shell’s Chilean downstream assets for $614m. Shell has been wanting to exit Argentina for some time, but had found it difficult under former president Nestor Kirchner’s administration, who opposed any sale to a foreign buyer, says a banker, noting the value of the deal should be more than $1bn. Such government opposition may have weakened since Kirchner’s death, paving the way for Luksic. A government go-ahead is said to be part of the negotiations happening this week, according to local press. “Shell is streamlining its portfolio of assets in the region,” says an oil sector analyst, who notes Shell’s business in Argentina represents about 15% market share. A Shell Argentina official declined to comment, and a Quineco official did not return a request for comment.