UK-headquartered oil and gas major BP has announced plans to close fuel production at its Kwinana Refinery, one of the biggest-of-its-kind in Australia.
The company will stop producing fuel from the refinery and will convert the Kwinana refinery to a fuel import terminal.
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Located in Perth, Western Australia (WA), the refinery is capable of producing 150,000 barrels per day (bpd) of oil.
BP noted that the Refinery is no longer ‘economically feasible’ due to the regional oversupply and continuous ‘lower refining margins’.
BP Australia country head 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.
“Converting to an import terminal will not impact the safe and reliable supply of quality fuel products to Western Australia, however, it will require fewer people to run. We deeply regret the job losses that will result and will do everything we can to support our people through the transition.”
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By GlobalDataAccording to Reuters, the conversion is expected to impact about 650 jobs.
Baudry added: “BP is committed to playing a leading role in growing Australia’s future prosperity, making significant investments in natural gas production, as well as inconvenience and mobility businesses.
“We are particularly excited by the shared ambitions with Western Australia to be net-zero by 2050 and the opportunities this can offer.”
Last month, BP was reportedly set to make 7,500 ‘compulsory redundancies’ after roughly 2,500 employees applied for voluntary severance.
In June, BP announced that it would release 15% of its current staff, impacting nearly 10,000 jobs. The company employs around 70,100 people worldwide.
The job cuts come as downturn due to the Covid-19 crisis has caused oil prices to slump.
