Page 8 - EurOil Week 24 2021
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EurOil INVESTMENT EurOil
Equinor sells Danish oil refinery
DENMARK NORWEGIAN oil company Equinor has struck “Given the proximity of our refinery in Ger-
a deal to sell its Kalundborg oil refinery in Den- many, I’m sure there will be lots of opportunities
The Kalundborg mark to Geneva-based Klesch Group for an for both refineries to work together; especially
plant processes up to undisclosed sum, the companies announced on when it comes to deploying our decarbonisation
107,000 bpd of oil. June 10. strategy,” Klesch group chairman Gary Klesch
The Kalundborg plant was built in 1961 said in a statement.
and acquired by Equinor in 1986. With an oil Neither company said when they expected
processing capacity of 107,000 barrels per day the deal to be closed. First the transaction
(bpd), it produces 5.5mn tonnes per year (tpy) will require the approval of authorities in
of gasoline, diesel, propane, heating oil and other Denmark.
products. After a gruelling year of refining losses
“This transaction supports Equinor’s strat- in 2020 as a result of coronavirus (COVID-19)
egy to focus its portfolio around core areas,” restrictions, some plant operators are opting
the Norwegian company’s head of marketing, either to sell their plants, close them or convert
midstream and processing, Irene Rummelhoff, them to produce biomass fuels. Equinor’s sale
commented. comes three months after France’s Total, now
Equinor’s attention will shift to its refining TotalEnergies, divested the 108,000 bpd Lind-
business in Mongstad, Norway, where it is look- sey oil refinery on England’s east coast to UK
ing to expand its low-carbon energy products fuel retailer Prax.
business, she said. The Kalundborg plant handles oil and con-
Klesch, which produces and trades oil and densate mostly produced at Equinor fields on the
metals, already controls the 100,000 bpd Heide Norwegian Continental Shelf (NCS). It receives
oil refinery in north Germany, which it bought this crude via tanker, and ships most of its fin-
from Royal Dutch Shell a decade ago. ished products by sea as well.
POLICY
OGA launches probe into lack of
failure to maximise recovery
UK THE UK Oil and Gas Authority (OGA) is open- If OGA finds that the companies did in fact
ing an investigation into a potential failure to violate its MER rules, it has the power to issue
The MER strategy aims maximise recovery because of a commercial financial penalties and even revoke licences
to ensure that as much disagreement. in cases of clear or persistent breaches. The
oil and gas is recovered The upstream regulator has not divulged investigation will now gather and assess
as possible. details, but it said that there was a “possible loss information and offer the companies con-
of value” as a result of the disagreement. This cerned the opportunity to provide written
represented a “possible failure” of companies to representations. After that, the regulator will
meet requirements under the OGA’s Maximis- decide its next steps.
ing Economic Recovery (MER) strategy. There The MER strategy aims to ensure that the
is now enough evidence for an investigation to maximum amount of oil and gas is recovered to
take place, it said. safeguard the UK’s energy security and ensure
OGA has often complained that producers the maximum economic benefit of North Sea
are not collaborating enough on the UK Conti- activities. It states that firms must consider
nental Shelf (UKCS), whose comparatively high whether co-operation “could reduce costs,
costs make it more rational for operators to work increase recovery of economically recoverable
together. In an open letter to operators in 2019, the petroleum or otherwise affect their compli-
OGA’s head of regulation, Tom Wheeler, said that ance with the obligation in question.” The OGA
“despite good progress, we still see too many issues has intervened on several occasions over the
taking too long to resolve or ending up in deadlock years, but it has rarely imposed sanctions on
between disputing parties, threatening MER.” operators.
P8 www. NEWSBASE .com Week 24 17•June•2021
