Aloha Petroleum Ltd. has agreed to buy retail and terminal operations in Hawai'i of Shell Oil Products U.S., in a deal that would give Aloha added Neighbor Island markets.

Aloha Petroleum yesterday issued a statement saying it had agreed to the purchase but did not disclose the price or details of what it was acquiring.

The sale comes as oil companies look at selling their so-called "downstream businesses," or refining and marketing operations. Instead, oil giants like Shell, Europe's largest oil company, want to place a greater focus on production and exploration.

A spokeswoman for Aloha declined comment on the pending transaction, and no one at Shell's Honolulu terminal was available for comment.

But Bill Green, a longtime Honolulu service station operator who is a consultant to Kahala Shell, said the transaction had been expected since last year.

"Basically the industry has across the board decided to get out of downstream marketing," said Green, who noted Shell has been exiting such markets on the Mainland.

Locally, it was expected that Shell would sell out to a "jobber," or business that would take over delivering and selling petroleum products to dealer service stations. He said Aloha was one of the companies that had most to gain from such a purchase and taking over the assets since it gains terminal distribution on Maui and Kaua'i.

Aloha primarily operates on O'ahu and the Big Island, with more than 50 fueling locations under the Aloha and Mahalo names as well as more than 30 Aloha Island Mart convenience stores.

The company owned primarily by private U.S. investors also supplies gasoline to Costco, NEX and AAFES as the state's largest independently owned gasoline distributor and retailer.

Green said he didn't know how many service stations Shell owned directly in the state, but that it sells product to many more that are operated by Shell dealers.

"We really don't know what it will mean," Green said.

As for stations owned by Shell, the press statement on the transaction said it is anticipated that Aloha will continue to operate the locations under the Shell brand.

The exact number of stations being sold to Aloha is unknown at this point since some of the assets are subject to first-right-of-refusal or options to purchase held by other parties.