Regulator clears Lukoil to buy Shell Neft, with requirements to sell fuel on exchange

MOSCOW. May 19 (Interfax) - The Russian Federal Anti-monopoly Service has cleared Lukoil to acquire the assets of Shell (SPB: RDS.A) plc in Russia on the condition it upholds requirements to sell petroleum products on the exchange, the FAS said.

Lukoil plans to acquire 99.9% of Shell Neft LLC.

Lukoil must sell fuel on the exchange regularly. The company must not but fuel during the main trading session on the exchange.

"The requirements are designed to develop competition in the petroleum product markets.

Lukoil said on May 12 that it had signed an agreement with subsidiaries of Shell plc to acquire 100% of Shell Neft, which is engaged in retail oil product sales and lubricants production in Russia, the Russian oil company said.

Shell Neft's assets include 411 retail stations, primarily located in the Central and Northwestern federal districts of Russia, and a lubricants blending plant located in Tver region.

Shell Neft's retail network consists of 240 sites owned by Shell, 171 sites owned by dealers and 19 Trademark License Agreement sites which are out of the scope of this transaction with Lukoil. Those within its scope stopped work on May 15 to effect the sales and transition of operating systems. The filling stations should be rebranded within a year.

Shell launched the lubricants plant in Torzhok in 2012 and announced plans last year to increase its capacity from 200 million to 300 million liters of lubricants per year.

The companies did not say how much the deal was worth. Shell wrote off expenses related to its Russia assets, including Shell Neft marketing assets, in Q1. "Shell assessed the recoverability of Shell Neft carrying amounts, resulting in an impairment of non-current assets of $358 million and other charges of $236 million," the company said in a Q1 financial report.