Shell is negotiating a potential sale of its filling station network in Malaysia to Saudi Arabia’s national oil company Saudi Aramco, sources told Reuters on May 7, estimating the deal could be valued at up to $1.1bn.

The network comprises 950 filling stations across Malaysia. Only Malaysia’s state-owned Petronas owns a bigger network in the country.

“Malaysia is important to Shell,” the UK major said in a brief statement following Reuters’ report. “We remain committed to the mobility business in the country.”

Saudi Aramco has not commented.

According to Reuters, talks on the sale started late last year and a deal could be completed in the coming months. The deal could be worth MYR4-5bn ($844mn-$1.06bn).

Shell has been working in Malaysia for 130 years, having discovered the country’s first oil onshore. Upstream, it produces oil and gas offshore Sarawak and Sabah, and it is also a joint venture partner in two LNG terminals in Bintulu, Sarawak. Downstream, it sells industrial lubricants in the country.

The divestment is part of Shell CEO Wael Sawan to narrow the group’s attention on its most profitable businesses. As part of this effort, the company has said it would look at selling 500 filling stations this year and next. It is also selling its refinery and petrochemical complex in Singapore that supplies its Malaysian network.

Shell has also announced plans to sell its majority stake in downstream business SDSA in South Africa, the primary asset of which is the 180,000 barrel-per-day (bpd) Sapref refinery. Its partner in the venture is Thebe Investment Corp.

Aramco lacks filling stations in Malaysia, though it does control a 50% stake in the 300,000 bpd Pengerang refinery in Johor in a joint venture with Petronas, which sells fuel domestically and exports it. Aramco owns stations in Saudi Arabia, and elsewhere in partnerships with France’s TotalEnergies and South Korea's S-Oil Corp.

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