Go-ahead for $365m Marsden Pt oil refinery expansion
Refining NZ shareholders approve a $365 million plan to upgrade the Marsden Pt refinery - lower profit posted.
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Hawke’s Bay
Refining New Zealand shareholders have voted to proceed with a $365 million expansion of the Marsden Pt oil refinery near Whangarei.
The company expects the new continuous catalyst regeneration (CCR) platform will boost its margins $US1.10 a barrel and increase revenue by $70m a year.
It is likely to increase the company's share of New Zealand's petrol market from 55% to 65% by 2016.
Chief Executive Ken Rivers says it is positive news for the company.
"This is a robust opportunity to grow the company and remain competitive against imported products," he says.
Shareholders voted on the plan at the company's annual meeting today. Sixty-five percent were in favour.
Chairman David Jackson told them the decision was "a significant and important one that will help shape the future of refining in New Zealand".
The proposal requires shareholder approval because the total project spend of $425m is to more than 50% of the company's market capitalisation.
Refining NZ's shareholding consists of BP (24%), Mobil (19%), Z Energy (17%), Chevron (13%) and Canadian investor Garlow Management (8%).
The remaining 19% comprises minority shareholders.
The CCR project replaces its 1960s semi-regulation Platformer, and is expected to be operational by late 2015.
The company announced at today's meeting a net profit after tax of $34.5m in 2011, down 40% from $57.7m in 2010.
Earnings before interest, tax, depreciation and amortisation was $132.6m, 15% drop from $156.6m in 2010.
Trading in company shares was suspended ahead of today's meeting in anticipation of the CCR vote.
Its share price has been hit by declining margins and were trading at $2.75 this morning, down from $4.50 a year ago.
Caleb Allison
Fri, 27 Apr 2012
Fri, 27 Apr 2012
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Go-ahead for $365m Marsden Pt oil refinery expansion
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