Shell has sold its South African downstream business to the Abu Dhabi National Oil Company (ADNOC) for $1billion.

And this is the single largest deal of its kind in South Africa in recent years.

Shell's South African operations include 580 fuel stations and the sale is expected to be completed in 2027 after regulatory approvals.

The British energy giant said the sale is part of its strategy to focus on 'key markets' and the company brand will remain in South Africa through licensing agreements.

So customers will still be able to use Shell's premium fuels and lubricants.

ADNOC sees this acquisition as a major step towards becoming a global mobility and convenience retailer, while advancing its fuel retail footprint in Africa.

Dan Coatsworth, head of markets at AJ Bell, noted that there was a sense of relief at Shell after it said second quarter integrated gas production would be better than previously expected.

And Shell's share price rose nearly three percent in London morning deals.

Shell also said its gas production had slumped in the April-June period due to the impact of the Middle East conflict on Qatari volumes.

Shell's gas production was impacted after the world's largest liquefied natural gas hub, Ras Laffan in northern Qatar, suffered significant damage in the war.

Shell publishes its full quarterly results on July 30.

This deal will change the fuel retail landscape in South Africa, with ADNOC now owning 580 fuel stations and Shell remaining through licensing agreements.

Shell South Africa Holdings has agreed to sell its equity interest in Shell Downstream South Africa to ADNOC.

The transaction is expected to be completed in 2027, subject to regulatory approvals.

Shell said the company brand will remain in South Africa through licensing agreements, while customers will still have access to Shell's premium fuels and lubricants.

ADNOC sees this acquisition as a major step towards becoming a global mobility and convenience retailer, while advancing its fuel retail footprint in Africa.

Shell's share price rose nearly three percent in London morning deals after the announcement.

This deal marks a significant shift in the South African fuel retail market and will have implications for local consumers and competitors.

ADNOC's acquisition of Shell's downstream business is a major move for the Abu Dhabi-based oil company, which is now expanding its presence in Africa.

Shell's gas production had slumped in the April-June period due to the impact of the Middle East conflict on Qatari volumes.

Shell's gas production was impacted after the world's largest liquefied natural gas hub, Ras Laffan in northern Qatar, suffered significant damage in the war.

Shell publishes its full quarterly results on July 30.

This deal will have economic implications for South Africa, with local fuel stations and competitors needing to adjust to the new landscape.

Key Facts

  • Shell South Africa Holdings has agreed to sell its equity interest in Shell Downstream South Africa to ADNOC.
  • The transaction is expected to be completed in 2027, subject to regulatory approvals.
  • Shell said the company brand will remain in South Africa through licensing agreements, while customers will still have access to Shell's premium fuels and lubricants.
  • ADNOC sees this acquisition as a major step towards becoming a global mobility and convenience retailer, while advancing its fuel retail footprint in Africa.
  • Shell's gas production had slumped in the April-June period due to the impact of the Middle East conflict on Qatari volumes.