- EU refining restructuring continues as EU refining activity remains low and, globally, refining margins continue to be weak as surplus capacity persists. There are however some signs of global refining investments being scaled back.
- EU net middle distillate imports surged in 2013; Russia remains a key EU supplier in 2014, closely followed by the US.
- Compared to refining in other parts of the world, refining in the EU suffers from among the highest operating costs, one component of which, energy costs, are also among the highest in the world. As a consequence, the net cash margins in recent years for EU refiners have been lower than for refiners in other regions of the world.
- The UK, supported by Germany, Ireland, Italy and the Netherlands made the following requests: 1) To establish a working group on the fitness check process which should meet over the coming months ahead of the completion of the fitness check. 2) On the fitness checks, some forthcoming EU Directives may impact on the sector and this should be considered as part of the fitness check process. 3) There could be an important role for the Oil Coordination Group to discuss security of oil supply, and particularly the role of refineries should be considered as part of this.
- Italy presented the main content of a study commissioned by Unione Pertolifera Italiana which assessed the impacts on the sector’s competitiveness of EU legislation. The study highlighted that legislation in the pipeline will cost the Italian refining sector some extra 7 billion euros in capital and operating costs between 2014 and 2035.
- The Commission responded that not all of the sector’s ills are due to EU legislation, as was clear from the IEA presentation, and that the Commission proposals follow a legislative path which includes approval by the Council and the European Parliament.
- The representative from Lukoil highlighted the need for the Commission to take into account that the industry is facing tough global competition and that it has to be strong and healthy to compete on an equal footing.
- On the 2030 energy and climate package, the Commission explained how industry competitiveness and other concerns were being addressed, but recalled that key to framework is reduced import dependence.
- DG Energy’s Director General, Dominique Ristori said, ‘tomorrow’s energy potential will depend on today’s research.
Adapted for web by Claira Lloyd
Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/07072014/eu_refining_forum_highlights_865/