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Shell signs agreements to sell Los Angeles Refinery and related assets to Tesoro


29/01/2007 - Royal Dutch Shell plc today welcomed the below announcement by Shell Oil Products US that it has signed an agreement to sells its Los Angeles Refinery and related assets to Tesoro:

Shell signs agreements to sell Los Angeles Refinery and related assets to Tesoro
Strategy to further grow and build strong branded presence in California and elsewhere will continue

Houston – Jan. 29, 2007 – Shell Oil Products US announced today that it has signed agreements to sell its Los Angeles Refinery, Wilmington Products Terminal and approximately 250 retail sites and supply agreements in and around Los Angeles and San Diego to Tesoro Corporation. The proposed sale is part of Shell’s previously announced ongoing strategy to streamline and concentrate its Downstream portfolio. The transaction is expected to close in mid-year 2007, assuming all regulatory approvals are obtained and other conditions to closing are satisfied.

The Los Angeles Refinery, which began operations in 1923 as California Petroleum Corp, has a crude throughput capacity of approximately 97,500 barrels per day. Shell acquired an ownership interest through a joint venture in 1998 and became sole owner in 2002.

Commenting on the proposed sale of the assets, Rob Routs, Royal Dutch Shell Executive Director Downstream, said: “This sale represents good value for our shareholders and because Tesoro are acquiring all assets as a going concern, it also secures jobs and energy supplies for people in Southern California. The deal we have negotiated comes as a result of a proactive approach from Tesoro to which we have reacted positively as it aligns with our ongoing strategy of managing our Downstream portfolio.”

The divestment is consistent with Shell’s strategy of managing its portfolio to deliver maximum value to customers and shareholders. The retail sites to be sold to Tesoro will remain Shell-branded, and Shell’s commitment to further build on its strong branded presence in California and elsewhere will continue.

Tesoro has advised Shell that it intends to offer employment to most, if not all, of about 500 affected Shell employees at the refinery, terminal, and certain employees within Shell’s retail organization. Tesoro has also expressed that it will abide by the collective bargaining agreement covering the Los Angeles Refinery employees.

Shell Oil Products US will honor dealers’ agreements and rights under the Petroleum Marketing Practices Act and any other applicable state or federal laws. Per the terms of agreements with multi-site operators (MSO), the company plans to assign some MSO contracts to Tesoro. Some supply contracts that Shell has with its wholesalers and open dealers in the area will be assigned to Tesoro.

Shell will continue to serve California’s diverse energy needs with significant investments in refining, terminal and pipeline operations, retail, exploration and production, lubricants, hydrogen and wind. Shell companies are committed to growing and enhancing the Shell brand in California while continuing to provide local motorists with high-quality fuels and services.

Shell is committed to maintaining all assets in its portfolio so that they run safely and reliably. The company will continue to make necessary investments in compliance, health, safety, environmental and other projects for these assets until the transaction with Tesoro is complete.

About Shell Oil Products US
Shell Oil Products US, a subsidiary of Shell Oil Company, is a leader in the refining, transportation and marketing of fuels in the United States. Shell quality fuels and services are available through more than 13,500 Shell stations nationwide. Shell Oil Products US is a dba for Equilon Enterprises LLC. Shell Oil Company is an affiliate of the Shell Group (NYSE:RDS.A) and (NYSE:RDS.B). For more information, please visit

About Tesoro Corporation
Tesoro Corporation, a Fortune 150 and a Global Fortune 500 company headquartered in San Antonio, Texas, is an independent refiner and marketer of petroleum products. Tesoro operates six refineries in the western United States with a combined crude oil capacity of more than 560,000 barrels per day. Tesoro’s retail marketing system includes over 450 branded retail stations, of which approximately 200 are company operated under the Tesoro® and Mirastar® brands. Tesoro’s commercial marketing system includes sales of jet fuel and marine fuels.

Disclaimer Statement

This document contains forward-looking statements concerning the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Royal Dutch Shell to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as ‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘probably’’, ‘‘project’’, ‘‘will’’, ‘‘seek’’, ‘‘target’’, ‘‘risks’’, ‘‘goals’’, ‘‘should’’ and similar terms and phrases. There are a number of factors that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this Report, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for the Group’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserve estimates; (f) loss of market and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and regulatory developments including potential litigation and regulatory effects arising from recategorisation of reserves; (k) economic and financial market conditions in various countries and regions; (l) political risks, project delay or advancement, approvals and cost estimates; and (m) changes in trading conditions. All forward-looking statements contained in this document are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of this presentation. Neither Royal Dutch Shell nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this document.

The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this presentation, such as “oil in place" that the SEC’s guidelines strictly prohibit us from including in filings with the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575 and disclosure in our Forms 6-K file No, 1-32575, available on the SEC website - opens in new window. You can also obtain these forms from the SEC by calling 1-800-SEC-0330.


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