Wednesday 19th May 2010
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New Zealand Refining is defining its US$5.55 per barrel gross refining margin for March and April as "healthy," despite slipping from US$6.85 in January/February and US$6.34 in March and April last year.
Throughput for the two months was 6.8 million barrels, but production through May will be reduced and margins affected by a maintenance shutdown on one of the Number 2 hydro cracker and crude distillation units.
The scheduled maintenance is scheduled to run to the end of May and will reduce refinery intake by around 20%, and will have an impact on margins because of limited capacity to "upgrade lower cost feedstock to high value products," NZ Refining said in a statement to the NZX.
In a briefing to shareholders last June, the company produced predictions for calendar 2009 which assumed gross refining margins of between US$3 and US$7 per barrel, but they sank much lower, averaging US$1.25 in September and October, and US$1.18 in November and December. In the latest two months, "refinery margins have remained healthy".
"At an average exchange rate of USD/NZD 0.7081 the processing fee earned for the period was NZ$37.1 million," the company said.
NZ Refining shares last traded yesterday at $3.43.
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