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Shell agrees sale of downstream businesses in Australia to Vitol

Shell today announced it has reached a binding agreement to sell its Australia downstream businesses (excluding Aviation) to Vitol for a total transaction value of approximately A$2.9 billion (US$2.6 billion).

The sale covers Shell’s Geelong Refinery and 870-site retail business - along with its bulk fuels, bitumen, chemicals and part of its lubricants businesses in Australia. It also includes a brand license arrangement and an exclusive distributor arrangement in Australia for Shell Lubricants.

It does not include the Aviation business, which will remain with Shell Group, or the lube oil blending and grease plants in Brisbane, which will be converted to bulk storage and distribution facilities.  The majority of Shell’s downstream staff in Australia will continue to operate the business under its new owner. 

Shell’s upstream operations in Australia, in which it will continue to invest, are not impacted by this announcement. 

Ben van Beurden, Shell’s Chief Executive Officer, said: “Australia remains important to Shell, but we are making tough portfolio choices to improve the company’s overall competitiveness. 

“Our customers will continue to benefit from the quality associated with the Shell brand and we are confident Vitol will invest in and grow the business.”

Vitol President and CEO Ian Taylor said: “This is an exciting acquisition for us, a good company led by an experienced management team and underpinned by the value of the Shell brand.  Australia is a growing economy and we look forward to working with the management team to strengthen and grow the business.”

Shell’s Australia Country Chair, Andrew Smith, acknowledged the enormous contribution that Shell’s downstream employees had made to the company over the past 113 years.

Smith said: “Like any business that operates for over a century, Shell’s business has changed over the years, and we are pleased to have found a buyer for the Geelong Refinery. Through the brand agreement reached with Vitol, the Shell brand will continue to be displayed across the company’s service station network and customers will still have access to quality Shell fuels and lubricants.

“Shell will continue to play a major role in the development of Australia’s expanding liquefied natural gas industry, and we look forward to strengthening our presence in the years ahead.”

The deal is subject to regulatory approvals and is expected to close in 2014. 

Recent downstream divestments by Shell include the sale of refineries in the UK, Germany, France, Norway and the Czech Republic; downstream businesses in Egypt, Spain, Greece, Finland and Sweden, as well as the creation of a downstream joint venture – with Vitol and other partners – across Africa, and the planned sale of some downstream businesses in Italy and Norway.

NOTES TO EDITORS:

Royal Dutch Shell plc

Royal Dutch Shell plc is incorporated in England and Wales, has its headquarters in The Hague and is listed on the London, Amsterdam and New York stock exchanges.

Shell companies have operations in more than 70 countries and territories with businesses including oil and gas exploration and production; production and marketing of liquefied natural gas and gas to liquids; manufacturing, marketing and shipping of oil products and chemicals and renewable energy projects. For further information, visit www.shell.com.

Vitol Group

The Vitol Group was founded in 1966 in Rotterdam, the Netherlands. Since then the company has grown significantly to become a major participant in world commodity markets and is now the world’s largest independent energy trader.

Its trading portfolio includes crude oil, oil products, LPG, LNG, natural gas, coal, electricity, agricultural products, metals and carbon emissions. Vitol trades with all the major national oil companies, the integrated oil majors and the independent refiners and traders. Globally Vitol trades over 5 million barrels of crude oil and oil products per day and revenues in 2012 were $303 billion. Further details on Vitol are available on www.vitol.com.  

MEDIA ENQUIRIES:

Shell

Shell Australia Media Relations

+61 417 007 344

Shell International Media Relations

+44 (0) 20 7934 5550

Vitol

Andrea Schlaepfer

+44 7525 403796

acs@vitol.com 

Fabian Gmuender

+44 7912 275395

fbg@vitol.com

Cohn & Wolfe, Geneva

Michael Holler

+41 22 908 4075

michael.holler@cohnwolfe.com 

Brunswick Group LLP, London

Patrick Handley

+4420 7404 5959

phandley@brunswickgroup.com 

Elizabeth Adams

+4420 7404 5959

eadams@brunswickgroup.com 

Bluetext, Washington DC

Don Goldberg

+1 202 365 5224

don@bluetext.com

The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate entities. In this press release “Shell”, “Shell group” and “Royal Dutch Shell” are sometimes used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general.

Likewise, the words “we”, “us” and “our” are also used to refer to subsidiaries in general or to those who work for them. These expressions are also used where no useful purpose is served by identifying the particular company or companies. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as used in this press release refer to companies in which Royal Dutch Shell either directly or indirectly has control, by having either a majority of the voting rights or the right to exercise a controlling influence.

The companies in which Shell has significant influence but not control are referred to as “associated companies” or “associates” and companies in which Shell has joint control are referred to as “jointly controlled entities”. In this press release, associates and jointly controlled entities are also referred to as “equity-accounted investments”.

The term “Shell interest” is used for convenience to indicate the direct and/or indirect (for example, through our 23% shareholding in Woodside Petroleum Ltd.) ownership interest held by Shell in a venture, partnership or company, after exclusion of all third-party interest.

This press release contains forward-looking statements concerning the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements.

Forward-looking statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements.

Forward-looking statements include, among other things, statements concerning the potential exposure of Royal Dutch Shell to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions.

These forward-looking statements are identified by their use of terms and phrases such as ‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘probably’’, ‘‘project’’, ‘‘will’’, ‘‘seek’’, ‘‘target’’, ‘‘risks’’, ‘‘goals’’, ‘‘should’’ and similar terms and phrases.

There are a number of factors that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this press release, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for the Shell’s products; (c) currency fluctuations;

(d) drilling and production results; (e) reserve estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions;

(i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions;

(l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; and (m) changes in trading conditions.

All forward-looking statements contained in this press release are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Additional factors that may affect future results are contained in Royal Dutch Shell’s 20-F for the year ended December 31, 2012 (available at www.shell.com/investor and www.sec.gov).

These factors also should be considered by the reader.  Each forward-looking statement speaks only as of the date of this press release, February 21, 2014. Neither Royal Dutch Shell nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information.

In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this press release.

The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. 

We may have used certain terms in this press release that SEC's guidelines strictly prohibit us from including in filings with the SEC.  

U.S. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov. You can also obtain these forms from the SEC by calling 1-800-SEC-0330.

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