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Oil major Shell has reportedly confirmed that a review of its global downstream operations could also include the closure of its bunker-producing refinery in Montreal.

In a statement, the company is understood to have informed employees that it would be carrying out a "strategic review" of its 130,000 barrels-per-day Montreal East Refinery, which has been operating since 1933. The review could ultimately lead to the facility and its associated businesses being sold, shut down or included as part of a joint venture.

"Shell has an obligation to determine future long-term options to ensure best value is being achieved with all its assets. This is part of normal Shell proactive portfolio activities," the company said in a statement.

Other options being considered are the possibility of allowing the refinery to continue operating and the idea of converting the plant into a fuel terminal that could import finished products from abroad.

A decision is not expected to be made for several months.

Together, Shell and Petro-Canada - which also operates a refinery in Montreal - are said to account for around 70 percent of the total bunker market in Montreal. Shell has its own barge and also uses road tank wagons for deliveries from Montreal to Quebec City.

The closure of Shell's main source of product for the marine fuels market would more than likely have a significant effect on the reliability of supplies at the port of Montreal, which already suffers from periods of tight availability when suppliers withdraw from the market due to lack of product.

Shell is understood to be weighing up its options at present in regards to the future of the Montreal East Refinery as it looks for alternatives to investing large amounts to improve the 76-year old plant. The onset of the global recession has weakened gasoline demand, particularly in North America, which in turn has reduced returns for the industry as a whole.