Shell Canada snapping up gas stations in preparation for energy transition

After saying its buy of 56 gasoline stations from the guardian firm of Sobeys Thursday, Shell Canada is looking out for different potential acquisitions because it seeks to develop its retail gas footprint throughout the nation.

“We’re always looking,” stated Kent Martin, basic supervisor of mobility for the Canadian subsidiary of British vitality big Shell plc, in an interview.

“If there’s other sites and other networks that are a good fit not only for the Shell mobility business but our integrated business, we certainly are looking at those.”

Shell Canada and Sobeys guardian Empire Co. Ltd. introduced Thursday Shell’s acquisition of 56 Empire-owned gasoline stations in Western Canada, for about $100 million in money.

Martin stated the deal aligns with Shell plc’s international push to develop its retail gas community in preparation for the approaching vitality transition.

“We are expanding our footprint, and that not only allows us to meet the needs of customers and motorists in Canada today, but also gives us a great opportunity to expand additional fuel offerings and low-carbon fuel offerings in the future in these locations,” he stated.

Martin stated Shell is forecasting gasoline demand will decline over the long run in favour of cleaner-burning fuels and electrical autos.

The firm believes it will possibly hedge towards these losses by not solely getting ready to sometime supply motorists hydrogen-based and renewable gas merchandise, but additionally by enhancing its comfort retailer choices in order that drivers who cease to cost their EVs will spend extra on meals and different gadgets.

It’s the identical technique different main gas retailers are banking on. Parkland Corp. introduced earlier this month that it’ll set up 50 ultra-fast charging stations throughout its Chevron and On The Run retail portfolio in B.C. and Alberta.

Like Shell, Parkland can be investing in buyer expertise, betting that EV drivers will spend cash on meals and retail gadgets whereas they wait for his or her automotive to cost.

Suncor Energy has additionally introduced it’s concentrating on EV charging as half of a bigger plan to spice up income from its Petro-Canada retail community, and to offset anticipated decrease gasoline gross sales sooner or later.

Earlier this 12 months, Suncor indicated it was contemplating promoting off Petro-Canada. But the corporate stated in November {that a} strategic evaluation had concluded Suncor’s finest guess can be to retain and “maximize” the chain by investing in partnerships in non-fuel associated companies reminiscent of quick-serve eating places, comfort shops and loyalty partnerships.

Suncor additionally stated it had concluded it was unlikely to discover a purchaser keen to accumulate the complete chain, or to pay the “premium valuation” the corporate believes its retail chain is value.

On Thursday, Martin stated Shell did have some early curiosity in Petro-Canada, however discussions by no means superior.

“The Petro-Canada network is very strong, so certainly there would have been interest in some of those assets. There’s no doubt about that,” he stated. “But we didn’t get to the point of any in-depth engagement.”

When it involves the newly acquired Empire places, Martin stated, Shell’s quick focus shall be updating the branding on the gasoline stations and making certain they meet Shell requirements. But he stated the corporate may even be assessing the entire new websites for potential upgrades and enhancements.

Martin added that as a result of Shell has a powerful presence in Europe, the place EV adoption has occurred quicker than in North America, the corporate has a powerful sense of what the gas station of the longer term will seem like.

“Having a very compelling retail offering is important . . . so things like strong Wi-Fi offerings, good coffee, areas where customers can spend time in the store,” Martin stated.

“We also do see just pure EV hubs in the future. I think we’ll start to see those pop up in Canada in the near future. We see those in Europe, and that will be part of the mobility landscape for us as well.”

This report by The Canadian Press was first revealed Dec. 15, 2022.