Reuters quoted eight sources as saying that Chevron is also considering selling other assets in Asia, including terminals and fuel storage facilities in Australia and the Philippines. Meanwhile, the company has appointed Morgan Stanley to explore these sales plans.
The above potential sale comes as Chevron is reorganized worldwide to streamline operations and reduce costs, and the company may also lay off up to 20% of its employees by the end of next year.
According to the website of Singapore Refining Company, the refinery has a production capacity of about 290,000 barrels per day, the smallest of the three refineries in Singapore. It is also equipped with seven ship berths, fully available for ultra-large tankers (VLCCs).
Three sources also said that companies invited to participate in the evaluation of shares of Singapore's refining company also include Swiss commodity trader Glencore.
In addition, the Chevron refinery deal will mark another large enterprise's exit from Singapore's refining industry.
If this transaction is reached, it will be Chevron's second recent withdrawal from Singapore's oil refining industry. Last month, Chevron has sold its shares in Chevron Phillips Singapore Chemicals.
Sources also revealed that PetroChina, which is holding the remaining 50% stake in Singapore refining company through its subsidiary Singapore Petroleum, enjoys the right to give priority to acquire Chevron shares.
In April this year, Shell Group completed a transaction to sell all the equity of Singapore's refining and petrochemical plants to CAPGC Sdn Bhd, with assets expected to be worth approximately US$1 billion (S$1.35 billion). CAPGC is a joint venture between PT Chandra Asri Pacific, a subsidiary of Indonesia's Jandra Asri Group, and Glencore Asia Holdings, a major Swiss commodity trading company. Some analysts pointed out that this shows that Singapore's carbon tax has increased the operating costs of oil companies and weakened its competitiveness with other local operators.
Potential buyers are required to submit a non-binding offer in July. According to sources, Chevron's equity in Singapore refining company is valued between US$300 million (S$386 million) and US$500 million.
People familiar with the matter said that U.S. oil giant Chevron is seeking to sell a 50% stake in Singapore Refining Company, and potential buyers include its joint venture partner PetroChina.