Brian Robins, Esther Han May 11, 2012
Looming cloud ... the closure of the Caltex oil refinery in Kurnell would put as many as 800 jobs at risk. Photo: Wolter Peeters
CALTEX has moved a step closer to closing the Kurnell oil refinery, which would leave Sydney without any refining capacity after Shell had decided to close its Clyde refinery.
As many as 800 Caltex and contractor jobs are at risk, although some jobs may be saved if the Kurnell refinery is turned into a storage facility, as is anticipated.
The closure would leave NSW totally reliant on imported fuel for the first time in nearly 90 years.
Last year, Caltex launched a review of its refining operations in Australia, putting a cloud over the Kurnell refinery along with the Lytton refinery in Brisbane. Yesterday, Caltex said Kurnell is continuing to lose money, and the internal review is now centred on the future of this complex.
The national secretary of the Australian Workers Union, Paul Howes, warned yesterday of the implications for motorists and employees if Caltex gets it wrong.
''Retaining a local manufacturing presence would give Caltex greater flexibility, and would be an important safeguard for motorists should there be a spike in the cost of imported fuel,'' he said. ''The Kurnell refinery plays an important role in Australia's energy security. We cannot afford to reduce our domestic refining capacity.''
In the March quarter, Caltex said its refining division lost $60 million before tax, up from the loss of $39 million before tax in the first quarter of 2011.
The company posted a first-quarter net profit of $106 million, down from $194 million.
At its annual meeting yesterday, Caltex told shareholders the refining review is ''focused on the Kurnell operation'', saying the Lytton refinery was ''better suited'' to produce the products demanded by customers.
An employee told the Herald last night Caltex had held information sessions for staff about a possible closure since last year. "We've been kept informed so it's obviously not new," the employee said. "I know they're still exploring options, seeing whether it's viable," the person said.
Earlier this year, Caltex wrote $1.5 billion off the value of its Australian refining assets.
with Esther Han