Shell to divest PCK Schwedt Refinery stake to Prax Group
In a strategic move to streamline its global refining operations, Shell Deutschland GmbH (Shell) has announced the sale of its 37.5% interest in PCK Raffinerie GmbH (PCK) to the Prax Group. This divestiture aligns with Shell’s objective to concentrate on key locations that are integrated into its operational hubs.
The refinery, situated in the Berlin-Brandenburg region of Germany, boasts a capacity of 245,000 barrels per day and is integral to the region, supplying approximately 90% of Berlin’s fuel requirements and serving the broader Eastern German area. Additionally, PCK plays a pivotal role in providing oil products to Poland and other neighbouring European nations.
Earlier this year, the Schwedt refinery had to reduce its production due to a disruption in its supply of Russian Urals crude oil, which had been consistently supplied through the Druzhba pipeline system since the refinery’s establishment in the 1960s. To compensate for this loss, the refinery has now secured a supply of Kazakh crude oil through the same pipeline. Additionally, it has augmented its resources with crude deliveries from the ports of Gdansk in Poland and Rostock in northern Germany.
The Prax Group, a British multinational and independent energy company, engages in the trading of crude oil, petroleum products, and biofuels. Operating across the entire oil value chain, from upstream to downstream, the group is known for its integrated approach.
This significant transaction is aligned with the Prax Group’s recent acquisition of the OIL! Tankstellen petrol retail network, markedly bolstering the Group’s offerings in continental Europe and positioning it as a major entity in the German market and the broader European refining sector. The Group envisions PCK as a cornerstone in its ongoing European expansion strategy, aiming to enhance customer service across the continent while ensuring a secure supply chain.
Sanjeev Kumar Soosaipillai, chairman and CEO of the Prax Group, remarked on the acquisition: “This agreement signifies another key milestone for our Group as we broaden our geographical reach and reinforce our presence in the European market. This acquisition in Germany lays down a robust platform for our continued expansion in Europe, underscoring our commitment to building a resilient and transformative supply chain to cater to our customers’ needs.”
The Prax Group, with a proven track record in operating and enhancing strategically vital assets across the oil value chain, plans to bring new investments to the refinery. This initiative aims to secure the future of the asset and its workforce while supporting the local economy and community.
Machteld de Haan, executive vice president for Chemicals and Products at Shell, highlighted the significance of this development: “This transaction marks a pivotal step towards a more focused refining portfolio and the enhancement of premier integrated sites like the Energy & Chemicals Park Rheinland.”
The completion of this transaction is anticipated in the first half of 2024, contingent upon the exercise of partner rights and obtaining necessary regulatory consents.
Other stakeholders in the joint venture include Rosneft, holding a 54.17% share under trust management, and Eni with an 8.33% stake. Both possess a right of first refusal.
