White­gate re­fin­ery prof­its plunge but own­ers paid $55m div­i­dend

Irish Independent - Business Week - - FRONT PAGE - John Mul­li­gan

THE Cana­dian own­ers of Ire­land’s only oil re­fin­ery – White­gate in Cork Har­bour – were paid a $55m (€48.4m) div­i­dend by the com­pany be­hind the fa­cil­ity last year.

The pay­ment was made just over a year af­ter Irv­ing Oil ac­quired the re­fin­ery.

Ac­counts just filed for the White­gate busi­ness, which re­vealed the div­i­dend pay­ment, also show that pre-tax prof­its at the re­fin­ery plunged last year by 80pc to $14.3m (€12.6m), while turnover rose to $1.5bn (€1.32bn) from €1.3bn in 2016.

“An im­proved risk mit­i­ga­tion strat­egy for com­mod­ity price risk, off­set the im­pact of in­creased crude oil prices on gross mar­gin,” its di­rec­tors said in the ac­counts.

Irv­ing, which dur­ing the sum­mer bought Ire­land’s Top Oil, ac­quired the formerly State-owned White­gate re­fin­ery in 2016 from Philips 66.

Philips 66 said in its 2016 an­nual re­port that the net car­ry­ing value of the White­gate as­sets at the time of the sale was $135m (€119m), which in­cluded $127m in in­ven­tory, other work­ing cap­i­tal and $8m of good­will.

Philips 66 said an “im­ma­te­rial gain” was recog­nised on the sale to Irv­ing Oil.

Irv­ing Oil, which is based in New Brunswick, is a pri­vately-owned com­pany that op­er­ates the largest re­fin­ery in Canada.

The New Brunswick fa­cil­ity can process more than 320,000 bar­rels of oil a day.

White­gate pro­cesses up to 75,000 bar­rels of oil a day. It pro­duces petrol, diesel and kerosene and sup­plies about 40pc of re­fined fuel used in the Ir­ish mar­ket.

The com­pany be­hind the re­fin­ery – Irv­ing Oil White­gate Hold­ings – noted that crude oil prices had con­tin­ued to rise dur­ing 2017.

The ac­counts also show that the White­gate re­fin­ery paid $1.43bn (€1.26bn) on crude oil pur­chases dur­ing 2017, and in­curred $9.8m in trans­porta­tion costs, which was more than dou­ble the amount spent in 2016.

Its man­u­fac­tur­ing, op­er­at­ing and ad­min­is­tra­tive ex­penses jumped to $66.5m (€58.6m) last year from $50.6m in 2016. The re­fin­ery em­ploys about 170 peo­ple, who were paid com­bined salaries of $20.4m (€17.9m) last year, or an av­er­age of $120,700 (€106,350) each.

When it ac­quired White­gate, Irv­ing Oil said that, as with its New Brunswick re­fin­ery, “safety is al­ways our num­ber one pri­or­ity”.

Irv­ing Oil was forced to tem­po­rar­ily shut its New Brunswick re­fin­ery in early Oc­to­ber this year af­ter an ex­plo­sion and a fire that fol­lowed.

Pro­ces­sor:

Ire­land’s only oil re­fin­ery, White­gate in Cork Har­bour, em­ploys 170 staff who were paid a com­bined €18m last year

The com­pany had closed most of the plant for planned main­te­nance in late Septem­ber, but its smaller, 25,000 bar­rels of oil per day petrol-mak­ing units, and a 125,000 bar­rels of oil per day crude unit, were still run­ning at the time, a source said at the time.

Cana­dian me­dia re­ported last month that the cause of the fire re­mains un­known. Pip­ing has been re­moved from the site of the fire for anal­y­sis to de­ter­mine whether it was dam­aged as a re­sult of the blaze, or was it­self a pos­si­ble cause of the fire. No­body was se­ri­ously hurt in the in­ci­dent.

Ad­di­tional re­port­ing: Reuters

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