Abu Dhabi National Oil Company (ADNOC) is on the verge of acquiring Shell’s South African fuel retail business for approximately $1 billion, a deal that would hand the UAE state oil giant control of around 600 fuel stations and roughly 10% of Africa’s largest fuel market.
According to Bloomberg, ADNOC Distribution — the publicly listed retail arm of ADNOC — is the entity leading the acquisition. The two companies are preparing to announce a definitive agreement within days, marking the final stage of negotiations that began earlier this year.
If completed, the transaction would represent one of ADNOC’s most significant investments in sub-Saharan Africa, extending the company’s push to expand its downstream and retail footprint well beyond the Middle East.
South Africa is the continent’s most industrialised economy and among its largest fuel markets, making its downstream energy sector a consistent draw for international investors. Gaining Shell’s extensive retail network would give ADNOC an immediate, large-scale presence in that market rather than requiring years of organic growth.
For Shell, the divestment aligns with a broader strategic shift to streamline its portfolio and concentrate resources on higher-return business segments — a pattern the British energy major has pursued across several markets in recent years.
The deal underscores a wider trend of Gulf state energy companies moving aggressively into African downstream markets. ADNOC has been expanding its global retail and distribution operations, and a foothold in South Africa would serve as a credible base from which to consider further moves on the continent.
South Africa’s retail fuel sector is regulated by the government, which sets pump prices through a monthly pricing mechanism that accounts for international oil prices, the rand-dollar exchange rate, and local levies. Any new market entrant of ADNOC’s scale would operate within that framework, limiting pricing flexibility but also providing a degree of revenue predictability.
The 600 stations that would transfer under the deal represent a mature, geographically distributed network — an asset that would take considerable time and capital to replicate from scratch, reinforcing the strategic logic of an acquisition over greenfield development.
Neither ADNOC nor Shell has publicly confirmed the deal. Bloomberg cited people familiar with the matter in reporting that a formal announcement is imminent.
