HOUSTON – Phillips 66 is ending its ties to its refining business in Asia with a deal announced Wednesday to sell its 47-percent stake in a Malaysian refinery for $635 million in cash.
It is selling its interest in the Malaysian refinery, which has a processing capacity of 170,000 barrels a day, to Petronas, the state-owned company that owns the other half of the facility. The deal is expected to close at the end of the year.
The Houston refining company of late has been building up its energy infrastructure and chemicals businesses. The rest of Phillips 66’s refineries are in the United States and Europe, according to regulatory filings.
“This divestiture allows us to redeploy resources to more strategic areas of our business,” said Larry Ziemba, executive vice president of refining for Phillips 66, in a written statement.
The Malaysian refinery makes gasoline and diesel that is sold in Malaysia and other Asian markets. Dean Acosta, a spokesman for Phillips 66, said the firm won’t have a refining presence in Asia after the deal closes.
“We continually evaluate the assets in our portfolio to identify opportunities to significantly enhance returns,” Acosta said in an email. “We do that through portfolio management as well as improving margins on our current assets.”
As Phillips 66 leaves its Asian refinery behind, GE’s oil and gas arm is supplying a major piece of turbo-machinery to Malaysia’s second offshore liquefied natural gas facility.
In a separate statement, GE said Wednesday it won a contract to assemble its gas turbine-powered gas cooling train – equipment used to cool natural gas into a liquid state – for Petronas. The project, which will collect supplies from small offshore gas fields that don’t have access to onshore pipelines, is expected to start up in the third quarter of 2017.