Refining ekes out extra margin from recent upgrades

NZ Refining returned to profit in the first half of this year. Photo / AP

New Zealand Refining, operator of the country's only oil refinery, added an extra US cent to its margins from recent upgrades, and anticipates further gains from a bigger project to be completed next month.

The refinery anticipates the margin will be widened by a further 90 US cents to US$1.10 per barrel once the Te Mahi Hou upgrade to replace an ageing petrol manufacturing unit is completed next month.

The Whangarei-based company has lifted margins 13 US cents per barrel from a series of initiatives aimed at lifting productivity, ahead of the 12 US cents per barrel improvement flagged in August, it said in a statement.

NZ Refining returned to profit in the first half of this year as a weaker kiwi dollar and a sharp drop in oil prices helped widen the company's refining margin.

The shares increased 0.3 percent to $3.43, and have climbed 54 percent this year, outpacing the 1.8 percent gain on the NZX All Index over the same period.