NZ Refining picks 91pc profit slump after fuel demand falls

New Zealand Refining, operator of the Marsden Point oil refinery, said 2009 processing margins fell to a six-year low as global fuel demand waned.

The company charged an average US$4.16 a barrel to process its customers' crude last year, down from US$9 in 2008 and the lowest annual average since 2003.

Margins fell to US$1.18 in November and December, from US$8.88 at the start of the year, the Ruakaka-based refiner said yesterday.

New Zealand Refining, controlled by Royal Dutch Shell, Exxon Mobil, BP and Chevron, processes oil for its major shareholders at rates based on refining margins in Singapore, Asia's largest oil-trading centre.

It warned in December that full-year profit may fall as much as 91 per cent to $10 million after global margins slumped and the high local dollar trimmed revenue.

The plant's processing dropped 3 per cent to 37.9 million barrels last year. Production was interrupted in September when the company installed new units to increase diesel and jet fuel output.

Processing fees fell to $188.7 million, from $346 million in 200.

NZ Refining shares closed yesterday down 15c at $3.66.

- BLOOMBERG