Total, Glencore, Gunvor in race to buy Chevron's 75% stake in South African assets

French energy giant Total SA, commodity trading and mining company Glencore International and Swiss commodity trader Gunvor are in the race to buy a 75 per cent stake in Chevron's South African downstream assets, which include a refinery, Reuters today reported, citing three industry sources.

The second bidding round closed on 30 September, with a selling price estimated at $1 billion expected for the assets in South Africa as well as neighboring Botswana, the report said.

Chevron had in January announced plans to sell its controlling 75 per cent stake in its South African business unit, the report added.

Chevron operates in South Africa through its subsidiary Chevron South Africa (Pty) Limited, in which a consortium of Black Economic Empowerment shareholders and an employee trust hold a 25 per cent interest.

Chevron South Africa has 850 Caltex retail fuel stations, the refinery in Cape Town that processes 110,000 barrels of crude a day and a Durban-based lubricants business.

The retail outlets sell transportation fuels, all containing Chevron's proprietary Techron additive, and a range of Caltex-branded lubricants. Caltex Havoline and Delo lubricants are also available throughout South Africa, through authorised distributors and at auto parts stores.

Chevron, the largest oil producer in the US after Exxon Mobil, is restructuring by selling assets, cutting jobs and delaying drilling projects after oil prices fell last year to the lowest level in more than a decade.

The California-based company had said late last year that it would sell assets worth about $10 billion by 2017, in an effort to weather a global slump in energy prices.

As part of this plan, Chevron's Canadian unit sold its Burnaby oil refinery and fuel distribution network in British Columbia and Alberta. It also sold its two gas storage facilities in British Columbia, including Aitken Creek, the largest in the province, to Fortis Inc for $266 million.

In March, it also sold off the last 497 Esso gas stations for $2.8 billion. It is in talks to sell its assets worth $2 billion in Bangladesh, and may sell its geothermal assets in Indonesia worth more than $2 billion, and natural gas field assets in Thailand worth around $500 million.