The Marsden Point oil refinery is to undergo its third major upgrade in seven years, with the board of New Zealand Refining signing off a $425 million project today, despite also announcing a 40 percent drop in profit for the year to December 31.
The company is also in the hunt for a new chief executive, with the announcement that the incumbent, Ken Rivers, will return to Britain this year and a replacement to be announced in the next six months.
The upgrade project requires approval from shareholders at the annual meeting in April, but is assured since the major petrol retailers own the bulk of the company and are represented on the board of the country's only refinery.
Volatile refining margins towards the end of the year were mainly to blame for the drop in net profit to $34.5 million, although average margins across the whole 12 months at US$6.11 were roughly comparable with US$6.17 margins recorded in the previous year.
"Overall, our net profit after tax was in line with the profit matrix issued in our 2010 annual report. While volatile refiners' margins can quickly impact our business, this result highlights our continued ability to withstand variable and challenging business conditions," said chairman David Jackson in a statement to the NZX.