Ellesmere Port’s oil refinery has signed up to fuel another major Middle East airline.
Almost a year after announcing a deal to supply aviation fuel direct to Emirates in a company first, Essar – which owns and operates the Stanlow refinery – has confirmed a similar new agreement with Etihad Airways.
In both cases the refinery, which produces two billion litres of jet fuel a year, is supplying fuel to aircraft at Manchester International Airport.
Etihad Airways is the national airline of the United Arab Emirates operating two flights a day direct from Manchester to Abu Dhabi Airport.
From its Abu Dhabi base, Etihad claims to fly to more than 110 passenger and cargo destinations in the Middle East, Africa, Europe, Asia, Australia and the Americas.
Essar explains the deal strengthens its aviation fuel business in the UK with the company now having direct jet fuel supply agreements in place with major airlines operating out of Manchester, Heathrow and Leeds Bradford airports.
It argues its jet fuel output plays a ‘key role’ in the country’s aviation industry.
Apart from individual airlines, Essar also currently supplies on a wholesale basis ‘a significant proportion’ of jet fuel demand at Manchester Airport as well as Liverpool John Lennon and other regional airports.
S Thangapandian, chief executive officer at Essar Oil UK, said: “This is another significant step in realising our objective of value chain integration by combining our refinery supply strength with our marketing capabilities in the aviation sector.
“This is aligned with our strategy of expanding the downstream presence of the business.”
S B Prasad, the company’s chief commercial officer, added: “This deal firmly demonstrates our commitment to achieve further growth in the aviation sector in support of our airline partners.”
Emirates, described as the world’s largest international airline, signed up with Essar last summer in what was seen as a ‘major deal’.
At the time, Essar said discussions with other potential carriers were ‘already under way’ and it looked forward to becoming ‘a key player in the aviation market’.
The new agreement is said to be the latest development in Essar Oil UK’s strategy of downstream integration which has also seen a successful entry into the UK fuel retail market with the opening of 33 Essar branded service stations to date.
Looking forward, Essar says it is committed to a ‘significant’ multi-million pound capital investment in major improvements to key units at Stanlow, previously reported as £105m.
These will deliver further reduction in crude oil costs and improved yields across the finished product range.
Apart from jet fuel the company also produces 16% of UK road transport fuels each year including 3bn litres of petrol and 4.4bn litres of diesel.