THEN THERE WERE THREE: BP REFINERY TO BE AXED

ONE of the nation’s four remaining fuel refineries is to shut down in a new blow for the federal government’s energy security policy.

BP has announced it will halt fuel production at its sole Australian refinery, saying it is no longer economically viable.

The Kwinana refinery, in southern Perth, will be converted into an import terminal. BP’s move – which will cost 600 jobs – comes amid growing pressure on operators in Australia, and follows threats by Viva and Ampol to shut their Geelong and Brisbane refineries. ExxonMobil has also said its Altona refinery is trading at a loss.

Energy Minister Angus

Taylor has tried to keep the refineries operating by imposing an import duty.

In a statement, BP said “it will cease fuel production at its Kwinana refinery and convert it to an import terminal, helping to ensure ongoing security of fuel supply for WA”. The refinery, near Fremantle, has provided fuel for WA for 65 years.

“However, the continued growth of large-scale, exportoriented refineries throughout Asia and the Middle East has structurally changed the Australian market,” BP said.

“Regional oversupply and sustained low refining margins mean the Kwinana refinery is no longer economically viable.

“Having explored multiple possibilities for the refinery’s future, BP has concluded that conversion to an import terminal is the best option.”

BP Australia head of country Frédéric Baudry said: “Today’s decision to cease refining is a difficult one and not in any way a result of local policy settings. It comes in response to the long-term structural changes to the regional fuels market.”