Santos is taking proactive steps to support Australia’s fuel security and assist domestic refiners during this period of heightened global uncertainty.
The closure of the Strait of Hormuz in the Middle East means over 20 per cent of global seaborne oil trade and over 20 per cent of global Liquefied Natural Gas (LNG) trade is now constrained. Around 80 per cent of oil and petroleum products transiting this waterway are destined for Asian refineries. This is having a significant impact on regional markets.
Viva Energy, who owns and operates the Geelong refinery in Victoria, has deferred some planned maintenance activities at the facility to allow maximum fuel production. To maintain this higher production level, the refinery requires prompt delivery of crude oil. Santos has worked collaboratively with Viva Energy to bring forward part of a 575,000-barrel Cooper Basin crude parcel by about a month. The cargo has been restructured into two separate parcels, enabling earlier delivery of part of the volume to support the refinery to maintain maximum production of fuels.
In addition, Santos last week sold a 150,000-barrel parcel of Varanus Island crude to Ampol, further supporting domestic refining capacity.
Santos Managing Director and Chief Executive Officer Kevin Gallagher said, “These actions demonstrate Santos’ commitment to working constructively with industry partners and government to maintain stable fuel supply and support Australia’s energy security during a period of global market disruption.”
Viva Energy Chief Executive Officer Scott Wyatt said, “Our Geelong refinery has been running at maximum rates since the recent events in the Middle East, with a focus on maximising diesel production. Santos’ prompt support to bring forward crude deliveries has been critical to maintaining this production and demonstrates how we are working together to safeguard Australian fuel security.”
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