In brief
- Output at the Viva Energy refinery is expected to ramp back up to over 90 per cent of capacity in the coming weeks.
- The company has pledged a full investigation into the cause of the fire.
Australia’s refinery operations are on the verge of a comeback following setbacks caused by a significant blaze. One of the nation’s two key refineries, recently damaged by the fire, is anticipated to resume operations nearly at full capacity in the upcoming weeks.
Viva Energy, which oversees the Geelong refinery, has restarted operations after a fire incident last Wednesday impacted parts of the site. The company recommenced trading on Monday, signaling a step toward recovery.
The conflagration occurred in the refinery’s gasoline complex, specifically within the alkylation unit. According to the company, the incident stemmed from a malfunction in the equipment.
In an announcement to the Australian Securities Exchange (ASX), Viva Energy revealed plans to gradually increase the refinery’s output.
“In the following weeks, contingent upon thorough plant inspections, we aim to boost production levels of diesel, jet fuel, and petrol to exceed 90% of the facility’s capacity,” the statement elaborated.
The company further noted that the refinery is projected to maintain these production levels until all necessary repairs are finalized.
The refinery was at a 60 per cent output for petrol following the fire and at 80 per cent for both jet fuel and diesel.
Viva has promised a full investigation into the cause of the incident.
The company had been in a trading halt following the fire, but resumed on Monday morning.
Viva shares dropped by as much as 9.5 per cent when it came out of the halt and were sitting at $2.38 before noon, down about six per cent.
The Geelong facility is one of only two refineries operating in Australia and provides 10 per cent of the country’s fuel supply and 50 per cent of Victoria’s.
Production had increased at the Geelong refinery amid the Middle East war and the closure of the Strait of Hormuz, which had placed pressure on global oil supply.
Economic support for truckers
The conflict has put strain on trucking companies due to the rise in fuel costs.
From Monday, freight and trucking businesses were able to apply for interest-free loans to help weather the price hikes of doing business.
The loans were part of a $1 billion economic resilience program package and will apply to businesses that make or transport fuels, fertiliser and agricultural products.
The concessions were announced by Prime Minister Anthony Albanese during a speech at the National Press Club earlier in April.
Industry Minister Tim Ayres said the loans would provide stability during volatile economic times.
“Firms in supply chains that are facing escalating costs and short-term cash flow pressures have access to short-term zero-interest loans to make sure that they sustain their businesses through this short-term shock,” he told reporters in Canberra.
“The billion-dollar facility is there to be used as much as it is required.”
Loans of up to $5 million are available for companies with a turnover of less than $100 million.
Australian Banking Association chief executive Simon Birmingham said the financial sector would support the rollout of the loans.
“Banks are stepping up to support the rollout of these zero-interest loans to businesses who are doing it tough as a result of the current conflict in the Middle East,” he said.
“This will be important support for impacted businesses in areas such as freight and logistics, fuel, fertiliser and plastics manufacturing.”
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