Australia's competition watchdog is again standing in the way of a proposed sale of assets by Exxon Mobil Corp. (XOM) to Caltex Australia Ltd. (CTX.AU), further disrupting the U.S. oil major's attempt to scale down its Australian gasoline operations.

The Australian Competition & Consumer Commission said Thursday that it has identified competition issues with Caltex's proposed acquisition of Exxon's share of a jointly owned fuel terminal at the port of Gladstone in Queensland state.

"The ACCC's preliminary view is that the proposed acquisition is likely to substantially lessen competition in the market for the supply of import-capable petrol and diesel terminal services in the Gladstone region," the regulator said.

In particular, the regulator said it's concerned the deal will impede effective entry by independent fuel suppliers in to the Gladstone region.

Caltex and Exxon on Nov. 4 declined to disclose a value for the transaction to Dow Jones Newswires. Caltex would continue to host Exxon Mobil's fuel terminal requirements at Gladstone, a Caltex spokesman said at the time.

While not a large transaction, the deal would have marked another stage in Exxon Mobil's exit from Australian gasoline markets following the sale of its filling stations to 7-Eleven Australia in May.

The stations were sold to 7-Eleven after the ACCC blocked a A$300 million sale to Caltex, which is 50%-owned by Chevron Corp. (CVX).

The ACCC has invited submissions from the market for the fuel terminal deal and deferred its final decision until Jan. 27.

Caltex's ownership share of terminal capacity in Queensland will increase marginally by 2.5% to 30.3% under the proposed acquisition, the Caltex spokesman said last month.

"The key drivers behind this arrangement were to realize cost and operational efficiencies for both parties," the spokesman said at the time.

Market-watchers suspect that Exxon Mobil will eventually sell its Altona oil refinery in Victoria state but the company has so far indicated that it wants to keep its Australian wholesale operations.

"We have no plans to sell any other terminal interests in Australia," an Exxon Mobil spokeswoman said last month. She reiterated that the U.S. oil major isn't currently looking to sell the Altona refinery.

-By Ross Kelly, Dow Jones Newswires; 61-2-8272-4692; Ross.Kelly@dowjones.com
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