Caltex Australia will temporarily close its Lytton oil refinery in Brisbane next month due to plummeting profit margins caused by the COVID-19 crisis’ effect on world fuel demand.
The company said the refinery will close in May as it brings forward a planned maintenance program originally due in July. The maintenance work is expected to be completed by August, but the refinery will not re-open until margin conditions have sufficiently recovered, it said.
Caltex said its refining margin at Lytton had virtually halved in the last 12 months. In 2019 its margin was $7.34/bbl. In January 2020 it had fallen to $5.78 with a further fall in February to $4.14/bbl.
The company supplied 20 billion l. of fuel in 2019.
Interim chief executive Matthew Halliday said that Caltex was shutting the refinery so that it can protect cash flows while demonstrating an ongoing commitment to the plant.
Halliday added that the company is working closely with customers and government agencies to ensure its supply chain remains resilient.
