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Shell has announced that it has reached a conditional agreement with Malaysian Hengyuan International Ltd (MHIL) for the sale of its 51 percent shareholding in the Shell Refining Company (SRC) in Malaysia for $66.3 million.

In a statement, Shell explained that MHIL has plans for SRC to invest in the necessary upgrades needed to meet the Euro 4M and Euro 5 European emission standard requirements. The transaction is expected to complete in 2016, subject to obtaining regulatory approval.

"Shell Malaysia Trading will ensure security of supply to its retail and commercial customers in Malaysia and honour other existing commitments through an existing comprehensive supply strategy that includes a long term offtake from Shell Refining Company," Shell said.

"The sale is consistent with Shell's strategy to concentrate its global downstream footprint and businesses where it can be most competitive. Malaysia continues to be an important country for Shell. Shell is the leading retail fuels and lubricants provider and continues to invest in growing these businesses in the country," the oil major added.

Other recent downstream divestments by Shell include the sale of downstream businesses in Australia and Italy; a number of retail sites in the UK; and the initial public offering of, and further drop downs to, Shell Midstream Partners L.P. Shell has also agreed the sale of its marketing business in Denmark and Norway, its LPG businesses in France and a 33.24% shareholding in Showa Shell Sekiyu KK.