Shell weighs shut Louisiana refinery's future as Baton Rouge firm promotes bid
Reuters
Published May 24, 2021 21:42
Updated May 25, 2021 00:30
By Erwin Seba
HOUSTON (Reuters) - Royal Dutch Shell (LON:RDSa) was still evaluating plans for an idled Louisiana oil refinery, the company said on Monday, after a Baton Rouge investor said over the weekend his $1.25 billion offer was not accepted.
American Clean Energy Refining LLC (ACER), based in Baton Rouge, submitted two bids for the refinery, the first last December, Chief Executive George R. Dabbs told Reuters on Sunday. Neither was accepted, he said.
ACER offered $1.75 billion for the 211,146 barrel-per-day (bpd) Convent, Louisiana, refinery before it was permanently idled in December, Dabbs said. The company bid $1.25 billion after it was shut, he said.
While not directly addressing ACER's bid, a Shell spokesman said the company has not made a final decision on the plant's future.
"Despite an extensive marketing process, a viable buyer was not identified," said Shell spokesman Curtis Smith. "Shell considers a wide range of qualifications and factors including a prospective buyer’s ability and experience to operate complex manufacturing assets safely," Smith said.
The company "is actively evaluating options for the site, including potential additional future marketing efforts or retention of the idled asset."
Last year, Shell decided to shut the Convent refinery because it was unable to sell it after it became unprofitable amid the loss of demand spurred by the COVID-19 pandemic. The company announced the closure on Nov. 5, while the refinery shutdown was complete on Dec. 14.
Dabbs said Shell has not told ACER why its bid was not accepted.
Shell has been shedding refineries globally to concentrate on refineries that are paired with chemical plants. it agreed to sell its 145,000-bpd Puget Sound Refinery to HollyFrontier Corp and plans to sell its stake in a Deer Park, Texas, plant to partner Pemex.
If Shell won't sell the refinery to ACER, the company plans to build a 300,000-bpd refinery along the Mississippi River near the Convent refinery, Dabbs said.
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