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Ellesmere Port oil refinery reports strong financial results

Tremendous progress in turning the business round since acquisition in 2011

The Essar refinery at Stanlow(Image: Essar)

Prospects are looking good at Ellesmere Port’s oil refinery.

Taking account of fresh investment on the horizon, Stanlow owners Essar Oil UK are bringing their total input, including acquiring the plant from Royal Dutch Shell in 2011, to over $1bn.

The $250m of added uplift follows the company’s ‘strong financial results’ for 2016/17 and will increase annual throughput from 68m to 75m barrels in 2018 it has been revealed.

Projects will deliver enhanced yields of high value products, reduce crude oil costs and drive revenue growth.

During the year the company reports it saw revenues of almost $5bn with its net worth increasing to almost $1bn.

A successful entry was made into the direct aviation fuel supply market for major airlines and there was a further expansion of its growing network of filling stations.

Profit before tax rose to $257m from $251m although after tax figures declined to $168m from $244m.

Figures show Stanlow processed just over 9m tonnes of crude, a 1.3% increase on the previous year’s output.

Stanlow Oil Refinery(Image: Robert Parry-Jones)

Essar Oil UK non executive chairman Prashant Ruia said: “The major investment we have confirmed in Stanlow will materially increase throughput and further grow revenues, building on the tremendous progress we have made in turning around the business over the past six years.

“It also demonstrates Essar’s commitment to remain invested in the oil and gas sector.”

Chief executive officer S Thangapandian said: “Essar has committed this year to a significant multi-million dollar investment at Stanlow. In addition the continued ambitious expansion of our UK retail network and direct aviation fuel supply business are also important strategic elements in the drive to build a fully integrated downstream energy company.

“This is on the back of a strong full year performance following record results posted the previous year.”

Although there was a downturn in industry profit margins Stanlow’s ‘excellent operational reliability’ and other measures saw its own margins reduce by less than half the average fall ‘which demonstrates the enormous progress made within the business’ Mr Thangapandian suggested.

The firm’s chief financial officer, Sampath P, said: “Despite a weaker market this is another impressive set of results that has helped to build a business with a net worth of almost a billion dollars.”

Essar says ‘significant’ improvements at Stanlow since 2011 have seen safety remaining a ‘critical business objective’ with continuous investment in health, safety and environmental aspects to further improve standards.

Connection to the national gas grid enabled the refinery to meet tighter environmental legislation regarding emissions while there has been a significant improvement in Stanlow’s operating and financial performance including the introduction of 37 new grades.

A number of new monthly records were established during 2017 including the highest ever amount of residue upgraded via Europe’s largest catalytic cracker and the highest ever production levels of diesel and other products.

The refinery is said by Essar to be ‘a key national asset’. Output includes 3bn litres of petrol, 4.4bn litres of diesel and 2bn litres of jet fuel per year.

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