Shell is considering divesting its Bukom oil refinery in Singapore as part of broader strategic review, reported Reuters citing sources close to the matter.

The company, which is reviewing the refinery as part of a revamp of its refining and chemicals business, has selected investment bank Goldman Sachs to explore a potential sale of the refinery.

Some of the companies considering purchasing the Bukom oil refinery are reportedly China’s state-owned Sinopec, as well as global trading companies Vitol and Trafigura.

Shell CEO Wael Sawan said the company is planning to cut investments over the next two years in order to boost profitability while remaining committed to achieving 2050 net zero emissions target.

As part of this effort, Shell has commenced energy and chemicals assets review on Bukom and Jurong islands in Singapore, reported Bloomberg News citing a Shell spokesperson.

Shell was quoted by the news agency as saying in an email: “Our strategic review is ongoing and we are exploring several options including divestment.

“This review is in response to the ongoing high grading journey of Shell Group’s Chemicals and Products portfolio over the years, the current challenging market conditions and enhanced capital discipline.”

Shell is in the ‘very preliminary stages’ of talks with interested parties. It is due to make a final decision on the asset’s sale.

Shell's only wholly owned refining and petrochemicals centre in Asia, the Bukom refinery is capable of processing 237,000 barrels per day of crude.

The refinery comprises a one million metric tonnes per year (tpy) ethylene cracker and a 155,000 tpy butadiene extraction unit.

These units are integrated with a monoethylene glycol plant at Shell’s petrochemicals site on Jurong Island.

Earlier this year, Shell abandoned its plan to build a biofuels plant at Bukom.