Shell and Cosan have reached an agreement to strengthen their Raízen joint venture in Brazil, by transforming the original joint venture agreement signed in June 2011 from a temporary to a permanent joint venture.
Raízen is the world’s largest individual producer of sugar cane, producing more than four million tonnes of sugar, more than two billion litres of ethanol and 2.2 gigawatt hours of cogenerated energy in 2015. It also operates a network of more than 5,800 Shell-branded service stations in Brazil.
The combination of Shell and Cosan’s retail experience and technical expertise has contributed to Raizen’s strong financial and operational performance since the venture was established.
Since the joint management began in 2011, when the transaction was valued between USD10 billion and USD12 billion, the Raízen joint venture is said to be worth between USD17 billion and USD20 billion today.
“Transforming Raízen into a permanent joint venture strengthens the partnership we built with Shell over the last five years, while paving the way to continue our successful journey in Brazil. Our partnership with Shell is instrumental to being recognized for excellence in the development, production and marketing of sustainable energy,” said Marcos Lutz, Cosan CEO.
“Low-carbon, sustainable biofuels play an important role today and will be required long-term for heavy-duty and long-distance transport. We are pleased with Raízen’s strong performance. This commitment reaffirms the stability of Shell and Cosan’s partnership and our shared view of the long-term objectives and value of the business,” said John Abbott, Shell’s Downstream Director.