Energy multinational Shell has ended a major chapter of its long-standing operations in South Africa after agreeing to sell its network of 580 fuel stations to Abu Dhabi National Oil Company (Adnoc) in a deal valued at about $1bn.
The transaction will allow the petrol stations to continue operating under the Shell brand through a licensing agreement, while Shell retains its oil and gas exploration activities along South Africa’s coastline.
The sale marks a significant shift for Shell, which has maintained a presence in South Africa for more than a century. The company’s history in the country dates back to the early 1900s, when fuel products carrying the Shell name were first introduced, followed by the establishment of a refinery in Durban.
For Adnoc, the acquisition represents a major step in expanding its global energy and fuel retail business, as the Emirati state-owned company continues to increase its presence in international markets.
Shell’s decision is part of a wider strategy to reduce its global retail operations and focus on areas that align more closely with its long-term business objectives. The company first announced plans to sell its South African fuel retail division in 2024.
Despite leaving the petrol station business, Shell said it would continue operating in South Africa through oil and gas exploration projects, including activities in offshore regions such as the Orange Basin and Cape Basin.
The company also confirmed its interest in potential drilling activities along the country’s eastern coastline, although some projects have faced legal challenges from environmental groups.
Shell’s exit from fuel retail comes as South Africa experiences economic and political pressures, including high unemployment, rising business costs, infrastructure challenges and social tensions.
Several international companies have reduced operations or withdrawn from the country in recent years, while businesses from China and the Middle East have increased their investments.
Adnoc said the acquisition would strengthen its ambition to become a leading global mobility and convenience retailer, while expanding its fuel distribution footprint across Africa.
The company added that it would involve a local empowerment partner holding a 28 per cent stake in the business to comply with South Africa’s ownership regulations.
