Texaco, Shell Sign Deal Creating New Firm

Shell Oil Co. and Texaco Inc. signed a previously announced agreement to combine most of their Western and Midwestern refining and fuel sales operations, a move that would create a company with eight refineries and more than 11,200 convenience stores and service stations. Shell would own 56% of the company and Texaco would own 44%. The two oil firms also said they are continuing negotiations on a previously announced agreement to combine assets with a 50-50 U.S.-based joint venture of White Plains, N.Y.-based Texaco and Saudi Aramco, Saudi Arabia’s oil company. Shell and Texaco declined to give the value of the new company. However, estimates in October valued the combined Shell, Texaco and Saudi assets at $14.8 billion. Shell is the Houston-based arm of the Royal Dutch/Shell Group of the Netherlands.