Royal Dutch Shell has signed an agreement with Vitol to sell its downstream businesses of Australia, for around A$2.9bn ($2.6bn).

As part of the agreement, Vitol will acquire Shell’s Geelong refinery and 870-site retail business, as well as bulk fuels, bitumen, chemicals and part of its lubricants businesses in Australia.

The deal also includes a brand license arrangement and an exclusive distributor arrangement in Australia for Shell Lubricants.

Royal Dutch Shell CEO Ben van Beurden said that Australia remains important to the company but the firm is making tough portfolio choices to improve overall competitiveness.

"Our customers will continue to benefit from the quality associated with the Shell brand and we are confident Vitol will invest in and grow the business," Beurden added.

The deal, which is expected to be completed in 2014, is subject to regulatory approvals.