Idemitsu Kosan Co., Ltd. (Idemitsu) has announced that its board passed a resolution on 14 June 2022, to acquire shares in Seibu Oil Co., Ltd (Seibu Oil) to make it a subsidiary, to terminate its product purchase agreement (product sales agreement) with Seibu Oil effective 31 March 2024, on the assumption that the termination of refinery operations at Seibu Oil's Yamaguchi Refinery in March 2024.
Pursuant to Idemitsu's corporate vision for 2030, 'Your Reliable Partner for Brighter Future', Idemitsu is engaging in technological innovation and business restructuring aimed at achieving a carbon-neutral society, while simultaneously fulfilling its social mission of providing stable energy supply.
Domestic petroleum product demand is expected to decrease further due to structural issues such as the ageing and decreasing population, the impact of the COVID-19 pandemic, and global trends towards decarbonisation. In light of this evolving operating environment, Idemitsu has determined that a revamping of the Idemitsu group's manufacturing and supply framework is inevitable, and that making Seibu Oil a subsidiary of the company, terminating the product purchase agreement, and terminating refinery operations at Yamaguchi Refinery is the best course of action for Idemitsu.
Until the termination of refinery operations, the company will continue to contribute to stabilising regional energy supply and ensuring that Seibu Oil operates safely. New business development using the former site of the Yamaguchi Refinery will be considered after termination of refinery operations, while also continuing the oil tank, storage, and solar power generation businesses. The company will cooperate with Seibu Oil in such operations and in measures towards the termination of refinery operations at Yamaguchi Refinery. Employment contracts with Seibu Oil employees will remain in place, and the company expects that it will be provided with opportunities to work actively in various capacities within the company or Idemitsu group refinery and complex.
Read the article online at: https://www.hydrocarbonengineering.com/refining/15062022/idemitsu-to-cease-operations-at-its-yamaguchi-refinery-by-2024/
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