ExxonMobil to invest $1 billion in Antwerp refinery

ExxonMobil will invest $1 billion in its 320,000 barrel per day (bpd) Antwerp refinery even as many firms pull back from a European industry hammered by low refining margins.

ExxonMobil said it would install a new unit at the Antwerp plant to turn high sulphur oils created as a byproduct of the refining process into various types of diesel, including shipping fuels that will meet new environmental laws.

The investment is significant as it shows major firms still see a future in oil refining in Europe, despite a series of closures in recent years as they adjust to lower demand and increased competition from overseas.

“The investment addresses an industry shortfall in capability to convert fuel oil to products such as diesel”, the company said in a statement.

The company said it was taking a long-term view of the European sector and was evaluating other potential investments to strengthen “strategic” refineries in the region.

Refining margins in Europe have fallen close to multi-year lows as demand has been hit by policies designed to reduce oil consumption, and as new mega-refineries in India and the Middle East have started to compete for market share.

The United States has also become a bigger exporter of oil products like diesel to Europe, as its refineries have benefited from lower domestic crude oil costs created by the shale oil revolution.

Industry analysts estimate that at around five plants will need to close in Europe to balance the market, but unprofitable plants often struggle on, sometimes with support from governments fearful of becoming reliant on other countries for their fuel needs.

Devon to sell assets for $2.3 billion 

Devon Energy has said it would sell its remaining non-core gas-rich properties to Linn Energy for $2.3 billion to focus on more lucrative oil assets and cut debt.

This is Linn’s biggest deal since it bought Berry Petroleum in December through a holding company set up for acquisitions.

The asset sale by Devon includes about 900,000 net acres spread across the Rockies, onshore Gulf Coast and some mid-continent regions, including all or parts of Kansas, Oklahoma, Texas, Arkansas and Louisiana.

These assets produce 275 million cubic feet of gas equivalent per day, about 80 percent of which is natural gas. They contributed about 7 percent to Devon’s total oil and gas output in the first quarter.

Devon and many other North American oil and gas producers have been selling off their natural gas holdings to focus on more profitable crude oil assets. Prices of natural have slumped after a shale boom in the United States.

Linn said it would fund the deal by selling its Granite Wash assets spread over Texas Panhandle and western Oklahoma as well as other non-producing acreage. It has also secured a $2.3 billion loan.