Hengyuan Refining Company Bhd (HRC) has entered into a binding term sheet with Shell Malaysia Trading Sdn Bhd and Shell Timur Sdn Bhd for the proposed renewal of its long-term product offtake agreement, potentially extending the arrangement for another 10 years until the end of 2036.
HRC said the term sheet sets out the principal commercial terms for the proposed renewal of its longstanding product offtake arrangement with the two Shell entities.
The proposed agreement will run from Jan 1, 2027 to Dec 31, 2036, comprising an initial five-year term followed by a further five-year renewal period, subject to mutual agreement between the parties.
HRC said the arrangement is intended to support the continued placement of products from its refinery and provide stability to its refinery operations over the longer term.
The binding term sheet provides the commercial framework for the parties to negotiate and execute a definitive Product Offtake Agreement.
