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Shell considers Australia Clyde Refinery conversion Terminal due mega-refinery competition

Home Forums Refining Community Refinery News Shell considers Australia Clyde Refinery conversion Terminal due mega-refinery competition

This topic contains 1 reply, has 1 voice, and was last updated by  Charles Randall 10 years, 9 months ago.

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  • #2306

    basil parmesan
    Participant

    Jobs at risk as Shell considers refinery’s future

    4/12/11

    Shell is planning to stop refining operations at its 75,000 barrel-per-day refinery at Clyde in Western Sydney. (Shell Australia)


    Oil refiner Shell Australia says competition from new mega-refineries in Asia has forced it to consider shutting down one of its of two local refineries.[/b
    ]The company is planning to stop refining operations at its 75,000 barrel-per-day refinery at Clyde in Western Sydney and instead use it as a distribution point for local and imported refined products like petrol.The refinery employs 310 staff, with that figure to be reduced to between 30 and 50 to operate the site as a fuel import terminal.
    If the proposal goes ahead, it would leave the company’s Geelong site as its sole local refinery.
    Shell spokesman Andrew Smith says employees at the Clyde plant will be consulted about the proposal before a decision is made.
    “These views will be taken into account by the boards when they consider the proposal,” he said.
    “I recognise this will create a period of uncertainty for many employees and it will be a difficult time for them.
    “However we are committed to a timely consultation process and providing them with support during this tough time.”
    Mr Smith says the company has to rethink the best way to continue the refining process.
    “There’s been a number of new, very large refineries built in the region and we see more being built in the future,” he said.
    “That is creating an overcapacity in refining and the outlook of refinery margins remain weak.”
    Mr Smith says the proposal to close the 100-year-old refinery is not the result of the Federal Government’s proposed carbon tax nor the cost of labour.
    “The issues that face the Clyde refinery are regional issues and its size,” he said.
    Shell says the Clyde refinery requires significant investment, including a maintenance turnaround scheduled for mid-2013.
    If the proposal is approved, the turnaround will not go ahead and the refinery will be converted into a fuel import terminal by mid-2013.
    Shell says it will replace output from the Clyde refinery, which supplies about 40 per cent of New South Wales’ fuel needs, with imports from Asia.
    “Those refineries in the region can supply Australian specification products in significant quantities these days, which wasn’t necessarily the case in the past,” Mr Smith said.

  • #5142

    Charles Randall
    Participant

    Here is update on Shell converting Australian Clyde Refinery to Terminal to import fuels from Asia mega-refineries.
    Spoken like true upsteam company that would rather put its market at risk for supply than invest in niche downstream markets. Shell as Dutch upsteam company has never been silent on its disdain for downstream assets & has already started ceeding Europe assets to others than upgrade them to capacity or heavier crude.

    The next round will of industry consolidation is already taking out refineries below 100 MBPD capacity which cannot compete with world scale +250-600MBD mega-refineries and especially those without bottoms conversion capabilities to run the increasingly heavier crude slates while minimizing asphalt and fuel oil production in favor of LS gas/diesel.

    The announced terminal conversion is necessary given the big exposure on clean up cost for refinery & also helps shake down regional concessions on tax breaks/ect given the loss jobs/revenue threats – but paves way for sales to new owner to have easier time with permits/operating cost with area.

    Independent oil companies (PBF in US, Petroplus in EU, Essar in India, ect) are picking up these “brownfield” potential investments with also a view to using site as way of bringing in exports from the larger mega-refineries (like Essar in UK Stanlow, or Brazil in Pasadena, ect).
    Regards

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