Photo: The Canadian Press
Motorists fill up their vehicles at a Shell gas station in Vancouver, Tuesday, March 8, 2022. Shell Canada says its purchase of 56 gas stations from parent company Sobeys is part of Shell’s long-term plan to expand its retail fuel network. stations across the country.THE CANADIAN PRESS/Darryl Dyck
After announcing the purchase of 56 gas stations from parent company Sobeys on Thursday, Shell Canada is eyeing other potential acquisitions as it seeks to increase its retail fuel footprint across the country.
“We’re always looking,” Kent Martin, chief mobility officer of the Canadian arm of British energy giant Shell plc, said in an interview.
“If there are other sites and other networks that are suitable not only for Shell’s mobility business, but also for our integrated business, we are certainly looking at them.”
Shell Canada and parent company Sobeys Empire Co. Ltd. on Thursday announced the acquisition of 56 Empire-owned service stations in western Canada by Shell for about $100 million in cash.
Martin said the deal is in line with Shell plc’s global push to expand its retail fuel network in preparation for the coming energy transition.
“We’re expanding our footprint, and that not only allows us to meet the needs of customers and motorists in Canada today, but it also gives us a great opportunity to expand additional fuel offerings and low-carbon fuel offerings in these locations,” he said.
Martin said Shell predicts long-term demand for gasoline will decline in favor of cleaner fuels and electric vehicles.
The company believes it can hedge against these losses not only by preparing to one day offer hydrogen and renewable fuel products to motorists, but also by expanding its self-service offerings so that drivers who stop to charge their electric cars, spent more on food and other items. .
It’s the same strategy other major fuel retailers rely on. Parkland Corp. announced earlier this month that it will install 50 ultra-fast charging stations across its Chevron and On The Run retail portfolios in BC and Alberta.
Like Shell, Parkland is investing in the customer experience, betting that EV drivers will spend money on food and retail goods while they wait for their car to charge.
Suncor Energy also announced it is focusing on electric vehicle charging as part of a larger plan to boost revenue from the Petro-Canada retail chain and offset expected lower gasoline sales going forward.
Earlier this year, Suncor said it was considering a sale to Petro-Canada. But the company said in November that a strategic review concluded that Suncor’s best bet would be to maintain and “maximize” the chain by investing in partnerships in non-fuel areas such as fast-food restaurants, convenience stores and loyalty partnerships.
Suncor also said it had concluded it was unlikely to find a buyer willing to acquire the entire chain or pay a “premium valuation” that the company believes its retail chain is worth.
On Thursday, Martin said Shell had some initial interest in Petro-Canada, but discussions never progressed.
“The Petro-Canada network is very strong, so there would certainly be interest in some of these assets. There’s no doubt about that,” he said. “But we haven’t gotten to any in-depth negotiations.”
As for the newly acquired Empire locations, Martin said, Shell will immediately focus on updating the branding at the gas stations and ensuring they meet Shell standards. However, he said the company will also review any new sites for potential upgrades and improvements.
Martin added that because Shell has a strong presence in Europe, where EV adoption has been faster than in North America, the company has a strong idea of what the gas station of the future will look like.
“Having a very compelling retail proposition is important … so things like a strong Wi-Fi offering, good coffee, spaces where customers can spend time in the store,” Martin said.
“In the future, we also see purely electric nodes. I think we will start showing up in Canada in the near future. We see them in Europe and that will also be part of the mobility landscape for us.”
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