Vitol, Glencore are said to plan bid for Chevron’s stake in Singapore refinery

[Singapore harbour and petrochemical oil plants at sunset]
tobiasjo/E+ via Getty Images

Global trading houses Vitol and Glencore (OTCPK:GLCNF [https://seekingalpha.com/symbol/GLCNF]) (OTCPK:GLNCY [https://seekingalpha.com/symbol/GLNCY]) are preparing binding offers for Chevron’s (NYSE:CVX [https://seekingalpha.com/symbol/CVX]) 50% share in the Singapore Refining Company, Reuters reported Wednesday, citing sources familiar with the matter. The stake, which values the entire refinery at around $1 billion, is slated to attract final bids in October.

Located on Jurong Island, the plant is Singapore’s second-biggest refinery, with capacity to process about 290,000 barrels of crude a day. PetroChina (OTCPK:PCCYF [https://seekingalpha.com/symbol/PCCYF]), which owns the other half through its Singapore Petroleum unit, holds the right of first refusal on Chevron’s (NYSE:CVX [https://seekingalpha.com/symbol/CVX]) stake.

Chevron (CVX [https://seekingalpha.com/symbol/CVX]) has tapped Morgan Stanley to oversee the sale as part of a broader divestment program aimed at cutting up to $3 billion in costs by 2026. Alongside the Singapore stake, the U.S. energy major is also marketing fuel terminals in Australia and the Philippines and retail assets in Malaysia, which could be sold individually or as a package.

Both Vitol and Glencore (OTCPK:GLCNF [https://seekingalpha.com/symbol/GLCNF]) (OTCPK:GLNCY [https://seekingalpha.com/symbol/GLNCY]) have been expanding refining and storage operations across Asia-Pacific. Vitol operates a refinery in Malaysia, the Geelong plant in Australia through Viva Energy and a major oil terminal at Tanjung Pelapas. Glencore (OTCPK:GLCNF [https://seekingalpha.com/symbol/GLCNF]) (OTCPK:GLNCY [https://seekingalpha.com/symbol/GLNCY]), via a joint venture with Chandra Asri, owns part of Aster Chemicals and Energy, which recently acquired Shell’s 237,000-barrel-a-day refinery and petrochemical complex in Singapore.

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