Shell China in talks with private oil companies

Shell China is in talks with private oil companies to purchase their gas stations as one large group. About 80 private oil companies from Liaoning, Hebei, Fujian, Xinjiang and Shandong provinces are negotiating with foreign companies, including Shell, for the group sale. The private gas stations are asking for an initial sale price 40% higher than the value of their assets, which include gas stations as well as supplementary oil storage facilities. Shell is expanding its footprint in China as the country liberalizes business rules and opens up markets to attract international companies to invest. Dai Yu, general manager of Base Chemicals Asia Pacific/Middle East, Shell Eastern Petroleum, said that in addition to steadily reducing import duties on most chemical products, China is now enabling foreign companies to establish wholly owned trading and distribution companies with low capital requirements. (July 2, 2007)