Phillips 66: Melaka Refinery

by Hugh Pickens, Ponca City Oklahoma

The purpose of this report is to provide a comprehensive overview of Phillips 66 that documents and explains the company's business strategy and execution of that strategy.

Major Sections of this report on Phillips 66 include:

Master Index of Articles about Phillips 66

by Hugh Pickens, Ponca City Oklahoma

The purpose of this report is to provide a comprehensive overview of Phillips 66 that documents and explains the company's business strategy and execution of that strategy.

Major Sections of this report on Phillips 66 include:

Melaka Refinery

News and Views from the Melaka Refinery

November 12, 2014: Phillips to Sell Maleka Refinery for 635ドル Million

FuelFix reported on November 12, 2014 that Phillips has made a deal to sell its 47-percent stake in a Malaysian refinery for 635ドル million in cash that is expected to close at the end of 2014. "This divestiture allows us to redeploy resources to more strategic areas of our business," said Larry Ziemba, executive vice president of refining for Phillips 66, in a written statement. Dean Acosta, a spokesman for Phillips 66, said the firm won’t have a refining presence in Asia after the deal closes. "We continually evaluate the assets in our portfolio to identify opportunities to significantly enhance returns," Acosta said in an email. "We do that through portfolio management as well as improving margins on our current assets."^[1]

October 29, 2014: Sale of Maleka Refinery is an Ongoing Process

Greg Garland told analysts during the third quarter earnings conference call on October 29, 2014 that the sale of the Melaka Refinery is an ongoing process. "We have an ongoing process at Melaka. And I think our expectation is certainly end of this year, first quarter next year, that we'll complete that process."^[2]

August 29, 2014: Second Unit Shut Down at Maleka Refinery

MSN reported on August 29, 2014 that Petronas is running the 100,000 barrels-per-day (bpd) Malacca refinery it jointly owns with US oil company Phillips 66 at a lower rate than usual after unexpectedly shutting a secondary unit. The refinery's crude distillation unit (CDU) will be running at a lower operating rate than normal from August 21 to September 8 while the secondary unit is being repaired, one of the sources said. Petronas operates two CDUs at the Malacca petroleum complex that run as standalone operations. It solely owns a 100,000-bpd CDU that mainly processes sweet crude.^[3]

February 14, 2014: Garland Says Phillips Expects to Sell Maleka Refinery in 2014

Greg Garland told security analysts at the Credit Suisse Global Energy Summit on February 12, 2014 that Phillips expects to sell Maleka and Whitegate in 2014. "We've gotten very good at selling the good things. I told Clayton we're going to have to get very good at selling the not-so-good things. Certainly [we] have a process underway with Whitegate. We have a process underway with Melaka. What I would say in that you should expect that we will draw those processes to a conclusion in 2014.^[4]

October 30, 2013: Garland Says Phillips Still Looking to Sell Its Interest in Melaka Refinery

Garland told analysts at the third quarter earnings conference on October 30, 2013 that Phillips is still looking at "selling possibly our Whitegate refinery in Ireland and our interest in the Melaka refinery in Malaysia, and so those efforts continue. We’re in the process of evaluating specifically the opportunities around Whitegate. So I think those have been the pieces of portfolio for us that long-term are really where the strategic interest is."^[5]

July 15, 2013: Melaka Refinery Crude Unit Restarted

Business Times reported on July 15, 2013 that the crude distillation unit at Phillips' Melaka refinery has restarted after being shut since mid-June. he unit, which processes 100,000 barrels per day (bpd), was shut after a fire at the refinery and was expected to be restarted by early July but the refinery has been hit with "technical issues" which caused the CDU to be shut longer than expected. "There was an issue with the steam chamber which is where the fire happened, but it affected the CDU as well," said a source familiar with the matter. The downtime in Melaka resulted in imports of about 1.2 million barrels of gasoline pushing the Asian gasoline margin on July 12 to more than a four-year high of US16ドル.74 a barrel, a trader estimated. Besides a base oil plant, there are two CDUs in the Melaka refinery that run as standalone operations.^[6]

January 30, 2013: Phillips Writes down 564ドル Million in Equity on Melaka Refinery

Greg Garland told analysts during the fourth quarter earnings conference on January 30, 2013 that had Phillips had taken a charge of 564ドル million for the impairment of our equity investment in the Melaka refinery. "This impairment was based on significantly lower estimated future refining margins in the region, driven primarily by expected increases in future crude oil pricing over the long term. As such, we determined that the fair value of our investment in Melaka was lower than our carrying value and that this loss in value was other than temporary."^[7]

December 13, 2012: Phillips Likely to Sell its stake in Melaka Refinery in Malaysia

Reuters reported on December 13, 2012 that Greg Garland told reporters on December 13, 2012 that Phillips will likely look to sell its Whitegate refinery in Cork, Ireland, and its stake in the 2 Melaka refinery in Malaysia. Phillips plans to retain stakes in the refineries it owns in the United Kingdom and Germany. "We don't envision growing in the Asian refining space," said Garland.^[8]

References

Master Index of Articles about Phillips 66

by Hugh Pickens, Ponca City Oklahoma

The purpose of this report is to provide a comprehensive overview of Phillips 66 that documents and explains the company's business strategy and execution of that strategy.

Major Sections of this report on Phillips 66 include: