Shell in Exclusive Talks to Sell Finnish, Swedish Refining Units to St1

Royal Dutch Shell Plc, Europe’s largest oil producer, is in exclusive talks to sell its refining units in Sweden and Finland to St1, a Finnish energy company, as part of a plan to streamline operations.

Shell won’t hold negotiations with any third party for the time being, David Williams, a company spokesman, said in an e- mailed statement today. The Gothenburg refinery has the capacity to process 78,000 barrels of oil a day and also has a marketing business in Sweden.

“Until a deal is finalized, which would be subject to appropriate regulatory approvals, Shell will continue to carry out its normal activities,” Williams said.

The Hague-based Shell is reviewing its global refinery business in an attempt to reduce costs and spending after the global recession curbed demand for fuels such as diesel. Shell on Aug. 20 said it agreed to sell its 90,000 barrel-a-day Heide refinery in Germany to private investor Klesch & Co. after putting Heide and neighboring Hamburg-Harburg up for sale last year.

Peter Voser, in his second year as chief executive officer, expects to double asset sales to as much as $8 billion by the end of 2011. Cost savings of $3.5 billion beat an earlier target by about 15 percent and were completed early, resulting in 7,000 job reductions that came in 18 months ahead of schedule.

To contact the reporter on this story: Fred Pals in Amsterdam at fpals@bloomberg.net

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