NZR
20/01/2015 08:58
MONTHLY
PRICE SENSITIVE
REL: 0858 HRS The New Zealand Refining Company Limited
MONTHLY: NZR: Margin and Throughput Report - November-December 2014
The Gross Refinery Margin1) (GRM) for the period was USD 9.98 per barrel with
a throughput of 7.1 million barrels. This delivered a Processing Fee income
of NZD 63.9 million, enabling the Fee Floor2) to be completely paid back to
customers. The average exchange rate was USD/NZD 0.78.
For the full year we achieved a GRM of USD 4.96 per barrel with a throughput
of 39.7 million barrels, ahead of the updated guidance of 39 million barrels
given in the interim results announcement. Processing Fee income was NZD 168
million, 5% ahead of the 2013 Processing Fee.
Singapore complex margins were healthy and averaged USD 4.48 per barrel for
November/December. Refining NZ's margin uplift over Singapore complex
margins of USD 5.50 per barrel for the period was again higher than the
normal range of USD 3 - 4 per barrel, driven by the 2014 margin initiatives,
excellent operational performance and favourable crude prices. The crude
price movements included an ongoing narrow Brent-Dubai spread and reduced
market premia for crude oil over the Brent and Dubai benchmark prices.
We saw crude prices decline further to end the year at around USD 50 per
barrel. Lower crude prices improve our competitiveness against imported
product due to lower inventory costs for our customers. At the current crude
price of below USD 50 per barrel, Refining NZ is competitive at a GRM of USD
4.50 per barrel or better.
Appendix I shows further information on throughput, margin and refining
income.
Historic Analysis
A five year history of Throughput, Margins and Processing Fees is attached as
Appendix II and can also be found on the company's website:
www.refiningnz.com
1) Refining NZ's Gross Refining Margin is defined as the typical market value
of the products produced minus the typical market value of the feedstock
used, expressed per barrel of feedstock used. The margin incorporates the
cost of the hydrocarbon used for fuel and incurred as process losses.
2) The Fee Floor is the minimum Processing Fee due, for a calendar year, up
to a maximum of NZD 126 million for 2014 (see Explanatory Notes for more
detail).
End CA:00259879 For:NZR Type:MONTHLY Time:2015-01-20 08:58:31
