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Refinery margins improve in May and June

Friday 10th August 2012

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New Zealand Refining, which operates the nation's only oil refinery, said refinery fees improved to average US$4.92 a barrel in the months of May and June, up from US$4.01 in the previous two months, contributing to an average for the first six months of the year of US$4.36.

But the latest figures from NZ Refining are still well below the average margins achieved at the refinery last year, when they averaged $US6.11 a barrel.

Current margins are more comparable with 2009, when the average for the year was US$4.16, although margins in that year gyrated between a high US$8.88 a barrel and US$1.18 a barrel.

Throughput at 6.6 million barrels over the two months was the same as in March and April, but down on the first two months of the year, when 7.3 million barrels of oil were processed.

"Margin and throughput for the period was impacted by the latter stages of the planned shutdown of the Platformer and Crude Distiller Unit, which was completed to plan in early May," the company said in a statement to the NZX. "All processing units are back on-stream and operating at near full capacity."

NZ Refining narrowly won a shareholder vote in April year to approve a $365 million upgrade, which the company expects will suppress dividends through much of the rest of this decade.

NZ Refining shares traded at $2.35 and have declined 17 percent this year.

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