BUSINESS – Shell Indonesia has officially announced its decision to exit the country’s fuel retail market, transferring its network of approximately 200 gas stations and a fuel storage terminal in Gresik to a joint venture between Citadel Pacific Limited and Sefas Group. This strategic move, Sourced from CNBC Indonesia on May 30, 2025, aligns with Shell’s global initiative to streamline operations and focus on more sustainable energy solutions.
The transition is part of Shell’s broader plan to divest around 1,000 fuel stations worldwide by 2025, as detailed in its Energy Transition Strategy 2024. This initiative aims to reduce carbon emissions and shift investments toward electric vehicle charging infrastructure and low-carbon energy sources. Despite the divestment, the Shell brand will continue to operate in Indonesia under a licensing agreement with the new joint venture.
Citadel Pacific, a Philippines-based holding company with interests in aviation services, telecommunications, gas distribution, and fuel marketing, already serves as Shell’s brand licensee in territories such as Guam and Hong Kong. Sefas Group, Shell’s largest lubricants distributor in Indonesia, brings extensive local market experience to the partnership.
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Shell’s decision to exit the fuel retail sector in Indonesia is also influenced by the challenging competitive landscape, dominated by state-owned Pertamina, which holds a significant market share due to its exclusive rights to distribute subsidized fuels. This dominance has made it difficult for foreign companies like Shell to compete effectively in the traditional fuel retail market.
Despite withdrawing from the fuel retail business, Shell remains committed to Indonesia’s energy sector. The company continues to invest in its lubricants business, operating a blending plant with a 300 million-liter annual capacity and constructing a grease manufacturing facility to meet growing industrial demand. These investments underscore Shell’s focus on high-value, low-emission products and services in line with global energy transition goals.
Shell’s strategic shift reflects a broader industry trend toward sustainable energy solutions and highlights the company’s adaptability in navigating complex market dynamics. As Shell repositions itself within Indonesia’s energy landscape, its continued investment in lubricants and low-carbon technologies signifies a long-term commitment to supporting the country’s evolving energy needs.
