Exxon Mobil (NYSE:XOM) and LyondellBasell NV (NYSE:LYB) have emerged as possible bidders for Shell’s (LSE:SHEL) US chemicals assets, which could be sold for up to $8 billion as the energy major seeks to reduce its exposure to weaker-performing operations.
The Financial Times reported on Monday that the two industry groups are among several parties exploring a potential acquisition of the portfolio.
Private Equity and Kuwait Group Join Bidding Interest
Apollo and the chemicals business of Kuwait Petroleum Corporation have also expressed interest in Shell’s US operations, according to the report, which cited people familiar with the sale process.
Interested parties submitted non-binding proposals last month as Shell assesses options for the assets.
The portfolio consists of four chemicals facilities spread across Louisiana, Texas and Pennsylvania, giving prospective buyers exposure to significant US petrochemical production capacity.
Pennsylvania Complex Included in Potential Sale
One of the most prominent assets is Shell’s Monaca complex in Pennsylvania. The facility started operations in 2022 following an investment of approximately $14 billion by Shell.
Monaca has the capacity to manufacture as much as 1.6 million tonnes of polymers each year.
With the entire US chemicals portfolio potentially valued at up to $8 billion, a transaction at that level would crystallise a considerable discount compared with Shell’s historical investment in the facilities, according to the Financial Times.
Shell Extends Chemicals Review to Europe
Shell’s portfolio review is not limited to the United States. The company has also started working with advisers to find potential buyers for its European chemicals operations, the report said.
The European assets are expected to attract a significantly lower valuation than their US counterparts.
The potential disposals form part of Shell’s efforts to reshape its asset base and move away from chemicals operations that have struggled to deliver satisfactory returns.
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