Shell plans to close German and Singaporean refineries in push to meet climate goals

According to an announcement made by Shell, the crude oil refinery in Wesseling, Germany, is planned to close by 2025. This decision is a part of the company's wider strategy to limit carbon dioxide emissions. The Wesseling refinery is set to be transformed into a facility that produces lubricating base oils, as reported by Reuters.

As emphasized by Shell and echoed in Reuters' report, the hydrocracking unit will be converted into a unit producing Group III base oils. These oils, mainly used in engines, are estimated to produce approximately 661,386 short tons annually. This will fulfill around 9% of the current European Union's demand and 40% of Germany's demand for such oils.

These measures aim to reduce Shell's operational carbon dioxide emissions in adherence with the company's ambitious plan. The overarching goal of this strategy is to lower overall greenhouse gas emissions - including those originating from fuels used by customers - to net zero by 2050, as stated by Reuters.

Shell also plans to sell its refinery and petrochemical plant in Singapore as part of this initiative. The petroleum processing at the Wesseling facility, located within the Shell Rheinland energy and chemical park near Cologne, will cease in 2025. Nonetheless, the process will continue at the Godorf refinery, as stated by the company.

The new production plant in Wesseling is scheduled to commence its operations in the latter half of this decade. The Shell Energy and Chemicals Park Rheinland, which includes both the plants in Wesseling and Godorf, currently boasts a production capacity of over 188 million barrels of crude oil per year. Of this total, Wesseling contributes by producing 82.8 million barrels.

In the recent past, Shell invested in a 10-megawatt electrolyzer for producing zero-emission hydrogen and a biomethane liquefaction plant at the Rheinland facility. Shell's portfolio since 2020 includes divestitures of five refineries, the closure of one, and the transformation of another into a terminal, as concluded by Reuters.