TonenGeneral Sekiyu will buy 99 per cent of the shares of Exxon Mobil Yugen Kaisha, which refines and sells fuel and lubricants, the Japanese refiner said. Exxon Mobil's stake in TonenGeneral will drop to 22 per cent from 50 per cent.
Exxon Mobil said the deal, announced Sunday, will result in a refining and marketing business "better positioned to meet Japan's energy needs."
Large oil and gas companies have been shedding refining operations in recent years, especially in developed markets where demand for gasoline and diesel has been weak. Tightening car and truck fuel economy rules are expected to keep demand for fuels low for years to come.
Marathon Oil spun off its refining operations last July. This summer ConocoPhillips also plans to split itself in two, separating its refining operations from its more profitable oil and gas exploration and production business. BP and Shell are selling refineries in the U.S. and Western Europe.
Exploring and producing oil and gas is generally more profitable than refining crude into gasoline and diesel. It offers investors a chance for faster growth. Also, oil prices are high and are expected to remain so, which has helped producer profits and funded a boom in new exploration.