By ALISON SIDER
Phillips 66 is selling its business in Ireland, including
the 71,000-bpd Whitegate refinery in Cork, the company said
Rich Johnson, a spokesman for the US refiner, said in a
statement that Phillips 66 has retained Deutsche Bank to market
the Ireland assets, which include the sole oil refinery in the country, its
associated wholesale marketing business and a storage terminal
for crude oil and refined products in Bantry Bay.
"Phillips 66 intends to
continue operating the assets as usual during the marketing
process, which is expected to last for several months," Mr.
The move reflects the challenges refiners are facing in
Europe, where lower demand for fuel and higher costs of feedstock have put pressure on
profits and led some companies to close down plants.
"If you look at key drivers of refining profitability -- none are
really favorable for Europe," said Morningstar analyst Allen
Most of Phillips 66's refining capacity is in the US and
the company has been focused on growing returns there, aided by
access to the country's booming output of inexpensive crude oil
from shale formations.
Mr. Good said importing fuel to Ireland might make more
sense than producing it there -- a potential buyer could turn
the Whitegate facility into a storage terminal than operating
it as a refinery.
"If it's not working for Phillips 66 [as a refinery], it's
unlikely that it's going to work for anyone else," he said.
Earlier this year, Larry Ziemba, Phillips 66's executive
vice president for refining, project development and procurement,
told analysts that the company would be open to selling the
Whitegate facility, saying that the refinery is "not sophisticated" and
not central to the company's strategy.
At the time, Mr. Ziemba also said Phillips 66 would also
consider selling its stakes in refineries in Malaysia and
Mr. Johnson said Tuesday that the company isn't currently
marketing any other assets for sale.
Dow Jones Newswires