BP To Close Brisbane Refinery, Up to 655 Jobs To Go Photo:

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Trevor Collett | Apr, 03 2014 | 4 Comments

Oil giant BP has announced it will close its Bulwer Island refinery in Brisbane by mid-2015, cutting 355 jobs in the process.

The refinery has a capacity of around 102,000 barrels per day, and BP says the Queensland facility is no longer viable, when mega refineries in Singapore and India can produce up to one million barrels per day.

BP announced its intentions earlier this year to sell off most if not all of its assets in Australia, joining Royal Dutch Shell in considering a move to import-only status.

From 2015, the Brisbane facility will retain just 25 of its current 380 employees to operate the import-only centre. More than 300 contract workers are also believed to be affected by the closure.

The refinery was built on reclaimed land by Amoco between 1964 and 1965 and was bought by BP in 1984. The refinery currently produces petrol, diesel, kerosene, aviation fuel, heating oil and LPG.

Bulwer Island operates an important fuel supply pipeline to Brisbane airport, and is the primary supplier of aviation fuel to Virgin Airlines. From 2015, the supply of aviation fuel will continue, but all fuel products will be fully-imported.

BP has already announced that its Queensland-based service stations will source fuel supplies from Caltex’s Lytton facility (also in Queensland), once the refinery is closed in 2015.

President of BP Australasia, Andy Holmes, blamed mega refineries overseas for the decision, saying they put huge commercial pressure on smaller scale plants.

“It’s against this background that we have concluded that the best option for strengthening BP’s long-term supply position in [Australia’s] east coast retail and commercial fuels markets is to purchase product from other refineries,” Mr Holmes said.

“While more of our transport fuel demand will be met by imports in the future, ample supplies are available to maintain Australia’s energy security.”

That last line has resonated with the NRMA, with its Running On Empty report earlier this year telling a different story.

The report says Australia is now the only International Energy Association member that does not meet its 90-day fuel stock obligation, and our dependence on imported transport fuel has risen from 60 percent in 2000 to 91 percent last year.

"BP cannot state that there isn't an increased risk to Australia's fuel security when there hasn't been a comprehensive analysis undertaken by the Australian Government,” NRMA’s Graham Blight said.

"This is why we are calling on the Australian Government to take action via the National Energy Security Assessment review this year and implement new policies to ensure Australia's liquid fuel security is protected."

In just over a decade, Australia will drop from 11 refineries to just four.

Sydney’s Clyde facility is gone, with the Kurnell refinery soon to follow, and the Port Stanvac refinery in South Australia closed in 2012.

BP says its Kwinana Western Australia plant will continue for now, joining ExxonMobil’s Altona refinery in Victoria and Caltex in Lytton.

Shell’s Geelong facility is the fourth and final on the list, but with the refinery having just been sold to Swiss company Vitol, it faces an uncertain future.

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