Page 6 - EurOil Week 30

EurOil COMMENTARY EurOil

Total sells major UK refinery

Total is also scaling back in the North Sea, while mulling the future of one of

its refineries in France

FRANCE FRANCE’S Total has struck a deal to divest the in Belgium, South Korea, the US, Saudi Arabia,
180,400 barrel per day (bpd) Lindsey refinery in Qatar and France.
WHAT: north-east England to UK conglomerate Prax The French major, Europe’s biggest refiner,
Panel no indent Group, it announced on July 27, without disclos- saw its margins narrow to $14.3 per tonne ($1.94
Panel indent ing a sales price. per barrel) in the second quarter, versus $26.3
Total and other majors are fast-tracking per tonne in the previous three months. Its CEO,
WHY: divestment plans to raise cash to weather the Patrick Pouyanne, described the margins as “cat-
Panel no indent oil market downturn. But the collapse in prices astrophic”, as coronavirus (COVID-19) travel
Panel indent means buyers are willing to pay much less for restrictions wreaked havoc on fuel demand.
assets than six months ago. Total is also report- Another factor behind Total’s decision at
WHAT NEXT: edly seeking a buyer for its 25.7% stake in the Lindsey might have been the UK’s impending
Panel no indent Shearwater Elgin Area Line (SEAL) gas pipeline exit from the EU and expectations that the gov-
Panel indent in the UK North Sea. ernment might lower or remove tariffs on for-
“Since the sale of our British retail network eign fuel imports.
in 2011, the Lindsey refinery hasn’t been part of “After considering several options for the
Total’s downstream system,” Total’s president for future of the Lindsey site, Total chose the one
refining and chemicals, Bernard Pinatel, said in that best protects local jobs,” Pinatel contin-
a statement. “It will be put to better use within ued. “The sale should be finalised by the end of
the Prax Group, an independent player with a the year, once conditions of the sale have been
growing UK network.” satisfied.”
Total instead wants to focus on its inte- Prax carries out downstream marketing and
grated refining and petrochemical platforms distribution through the Harvest Energy brand,

P6 www. NEWSBASE .com Week 30 30•July•2020