Geelong’s Viva Energy refinery could be the last left operating in Australia by 2022, following ExxonMobil’s closure of its Altona refinery.
The oil giant on Wednesday announced to 350 workers that the refinery would close after 72 years of operation.
One of four remaining refineries in Australia, Mobil’s Altona operations have been affected by COVID-19 border closures, flight cancellations and stay home orders.
Demand for jet fuel has dropped by up to 90 per cent.
ExxonMobil on Wednesday said the Altona refinery was “no longer considered economically viable” and would be converted into an import terminal to “ensure ongoing, reliable fuel supply for Victoria”.
ExxonMobil said the Altona refinery would remain in operation while transition work was undertaken “to ensure continued, reliable fuel supply for our Mobil customers”.
The closure follows BP Australia’s decision to make its Kwinana site in Western Australia an import terminal in 2022.
Ampol’s site at Lytton in Queensland is under review, with a decision expected to be announced in June.
Viva Energy chief executive Scott Wyatt said “while refining remains very challenging”, the company was committed to working with the federal government to implement its fuel security package.
Viva was also committed to working on investments with the state government and its planned LNG regasification facility to improve the refinery’s “competitiveness and long-term sustainability”, he said.
While “a lot that needs to be finalised”, Viva was making good progress and was encouraged by the support of government, business partners and the community for “the important role we play” in Australia’s energy security, Mr Wyatt said.
Victorian senator Sarah Henderson on Wednesday said the Altona closure meant Geelong’s refinery would be eligible for a greater share of the federal government’s production payment grants.
Last December, the federal government announced an “accelerated” production payment, worth $83.5 million over six months.
Australia’s major oil refineries will receive one cent in taxpayer funding per litre of petrol, diesel and jet fuel.
The federal government initially announced a fuel security package worth a total of 1.15 cents per litre for July 1 but brought forward the one cent production payment component to January 1.
