| NEW YORK
NEW YORK Oct 18 Royal Dutch Shell plc
has retained Deutsche Bank to sell its Martinez, California
refinery, according to three people familiar with the matter.
Shell is in the midst of a three-year, $30 billion
divestment plan following the company's purchase of BG Group
earlier this year.
A Shell spokesman said the company would not comment on
"rumor or speculation." Deutsche Bank declined to comment.
The refinery, located 30 miles (48 km) northeast of San
Francisco, has been operating since 1915. It can process about
165,000 barrels of crude oil daily into gasoline, jet fuel,
diesel and other refined products. It has a coker unit used for
processing heavy grades of crude.
The potential sale would also include a pipeline that brings
crude produced in California's San Joaquin Valley to the
One source familiar said the plant could be valued at about
$900 million. Parsippany, New Jersey-based PBF Energy
paid $537.5 million, plus working capital costs, for a
comparably-sized refinery in Torrance, California, which it
bought from Exxon Mobil Corp earlier this year.
Shell is entering into confidentiality agreements with
buyers who may be interested in reviewing the plant's data ahead
of a sale, the people said. PBF is a potential bidder, the
people said, citing the company's interest in California as
indicated by its purchase of the Torrance refinery.
PBF has sustained interest in the state at a time when many
refiners have tried to cut exposure to its regulatory regime,
the people said. Exxon and BP have already divested their
refineries in California and Shell previously sold one plant in
the state to Tesoro Corp. Valero Energy Corp had
previously retained a banker to seek a buyer for its California
refineries, but ultimately kept the plants.
PBF did not comment on the Martinez plant, but executives
said in the company's most-recent earnings call that there are
plans to continue to grow by acquisition.
While those looking to acquire energy assets are often
required to enter into confidentiality agreements with sellers,
Shell put additional constraints on the Martinez process by
barring potential bidders from retaining their own advisers
during the first round of bidding.
A sale of the Martinez plant would leave Shell with a
single, wholly-owned U.S. refinery in Anacortes, Washington,
though it has several joint ventures in the U.S. Gulf.
(Reporting By Jessica Resnick-Ault; Editing by Alan Crosby)