South Africa Offers to Buy Chevron Refinery, Other Assetsby
State-owned Strategic Fuel Fund has forwarded commercial offer
Chevron operates 110,000 barrels-per-day Cape Town refinery
South Africa’s state-owned Strategic Fuel Fund said it has expressed interest in buying Chevron’s Corp.’s Cape Town oil refinery, retail-fuel stations, and other assets in the country and in neighboring states.
“SFF has forwarded a commercial offer to Chevron and its financial advisers in relation to the purchase of the 75 percent interest on offer,” the fund, which manages South Africa’s fuel reserves, said in an e-mailed statement on Wednesday. The SFF said it first expressed interest in Chevron’s downstream assets after the second largest U.S. oil producer announced in January that it planned to sell.
Chevron is working with investment bank Rothschild & Co. on the sale that may fetch about $1 billion, people familiar with the matter said in March.
The South African business operates the 110,000 barrels-a-day refinery in Cape Town, a lubricant plant in the eastern port city of Durban and markets its Caltex-branded products through more than 845 filling stations, according to its website.
Chevron South Africa won’t discuss details of the expressions of interest, Jill Koopman, the company’s manager for policy, government and public affairs, said by e-mail.
Chevron had objected to plans for the building of more storage facilities to hold fuel imports as the country moved toward the introduction of more stringent clean-fuel standards. The company estimated it would need to spend $1 billion in refinery upgrades to meet the regulations.