Sharechat Logo

NZ Refining hydrocracker shut down after second leak

Tuesday 26th June 2018

Text too small?

New Zealand Refining's hydrocracker unit has been shut down after a newly installed valve failed, lengthening delays from its scheduled refinery maintenance shutdown.

A hydrocracker uses hydrogen to break down heavy oil fractions, recovered from crude oil, to produce petrol, kerosene - used as jet fuel - and diesel. NZ Refining is New Zealand's only oil refinery, and describes its hydrocracker as "the heart of the refinery."

The Whangarei-based company said the unit was shut down last night "following a weld failure on a newly installed OEM isolation valve", unrelated to last week's hydrocracker leak issue, and it would give a further market update "once we have established the repair and restart plan."

The refinery-wide shutdown was planned to run in stages from April 20 to June 8, and NZ Refining was to spend $85 million on it with a predicted financial impact of $30 million, but the restart was delayed due to maintenance issues and minor leaks. Last Friday, the company said there had been a delay with the hydrocracker due to two minor leaks and its team was assessing when the unit would be restarted, and yesterday it said it expected the hydrocracker to produce on-specification fuels that day.

NZ Refining also said yesterday that the shutdown would cost $25 million to $30 million more than the $85 million it previously forecast, implying a cost of $110 million-to-$125 million, and will cut $40 million from profit in calendar 2018 as opposed to $30 million previously flagged.

The company's shares last traded at $2.53, and have fallen 4.5 percent this year.

(BusinessDesk)

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

MARKET CLOSE: NZ shares dip as global trade jitters weigh on A2, F&P
NZ dollar set for weekly gain after Reserve Bank surprise
Burger Fuel exploring sale after review questions listing merits
New net migration data to remain rubbery for quite some time
NZX to push sales this year after reshaping business dents 2018 profit
Slowing new orders growth weighs on January PMI
New NZ dry dock a basis for new industry - KiwiRail
Wellington Drive beats 2H sales forecast, will meet earnings guidance
NZIQS decides more training is the answer to past president's misconduct
February 15th Morning Report

IRG See IRG research reports