The AFR is reporting that BP is mulling the sale of its two Australian oil refineries:
BP has flagged a restructuring of its struggling refining and marketing business in Australia, with analysts expecting the oil major to announce the closure of its Bulwer Island refinery in Brisbane, with the loss of several hundred jobs.
Andy Holmes, president of BP Australasia, is to make an announcement on the oil company’s “fuels supply chain” later Wednesday in Melbourne, BP said in a media alert.
The announcement comes amid cutbacks and closures throughout Australia’s refining sector, as local plants struggle with oversupply in refining in Asia, a strong dollar and high costs.
Here is the list of current and former Australian refineries:
Kurnell and Clyde are already shut.
The implications are straight forward. From the FT last year:
Australia consumes about 1m barrels a day of oil-refined products – on a par with a medium-sized European country such as the Netherlands. If the country imports half of its fuel requirements, as Canberra is now forecasting, it could easily surpass Indonesia’s fuel purchases of about 400,000 b/d – the largest in Asia and one of the biggest worldwide.
In 2000, when there were eight refineries in Australia, only 5 per cent of fuel was imported – equivalent to less than 100,000 b/d. Fuel imports rose to nearly a quarter of total demand by 2010, or 320,000 b/d, as consumption increased and one refinery closed.
Soozhana Choi, chief oil strategist at Deutsche Bank in Singapore, says further consumption growth and the impact of closing the Shell and Caltex refineries, which will reduce the total number of plants to five, would push Australia’s imports of petrol, diesel, jet fuel and fuel oil to 640,000 b/d by 2015.
House prices and liquid fuel insecurity to the moon, matey!
