
TY  - JOUR
A1  - Newman, F. P. 
T1  - THE AUSTRALIAN OIL REFINING INDUSTRY OUTLOOK
JF  - The APPEA Journal
JO  - The APPEA Journal
Y1  - 1976
VL  - 16
IS  - 1
SP  - 149
EP  - 155
KW  - 
UR  - https://doi.org/10.1071/AJ75017 
N2  - The Australian refining industry began with the establishment of two small refineries in the mid-1920s. However, it was not until the mid-1950s, after the construction of four large new refineries, that this industry emerged as an important factor in meeting the domestic demand for petroleum products. The refining companies are now able to meet about 90% of Australia&apos;s demand for refined petroleum products. This efficient industry provides a wide range of products of varying quality specifications.Existing and probable new government regulations relating to lead in motor spirit and to the level of emissions from refinery plant will necessitate a high level of investment in refinery plant. In the near future, our crude supply pattern is likely to become more dependent on Middle Eastern sources whilst the domestic market for refined products is trending towards a whiter barrel. Major capital investment in refinery plant will be required to adjust to these influences.A major problem facing the Australian oil industry is its recent low profitability. Reduced cash flows constrain the ability of the refining industry to undertake new investment.Actions by the OPEC countries have reduced the degree of vertical integration in the international oil industry and thereby reduced the profit earned on the extraction and sale of crude. Therefore the ability and the need for the major companies to support downstream operations as an aid to the sale of crude has also been reduced. The Australian oil refining and distribution industry must compete for investment funds with other companies in the international oil industry. Its current low return on funds and its debt gearing, already comparatively high by international standards, means that profitability must be restored before substantial new investment can be prudently undertaken. 
ER  -

