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Shell to sell interest in Deer Park refinery to partner Pemex
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HOUSTON/MEXICO CITY – Royal Dutch Shell agreed on Monday to sell its controlling interest in a Texas refinery to partner Petroleos Mexicanos (Pemex) for about $596 million, the latest move by the European oil major to cut its global refining footprint.
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The deal makes the Deer Park, Texas, facility the first foreign refinery that Mexico's state-run oil company will own solely in its history. The agreement was announced not long after Mexican President Andres Manuel Lopez Obrador complained that the 28-year-old joint venture had not been good for Mexico.
Shell is shrinking its refining and chemicals portfolio as part of a broader shift by oil majors to reduce hydrocarbon emissions and shift to lower-carbon fuels.
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Pemex said it plans to control and run the refinery after the deal closes late this year.
"This decision is consistent with Lopez Obrador's strategy of refining more. However, it casts many doubts about Deer Park’s future profits, especially after seeing the margins of just cents per barrel that Pemex is getting in its domestic refineries," said said Gonzalo Monroy, a Mexico City-based oil analyst.